HONG KONG -- Asian stocks edged lower on Tuesday after oil prices surged to a fresh record overnight, fuelling fears that higher inflation will sap consumer demand and business investment around the world.

Crude jumped to just shy of $140.00 a barrel before reversing course to trade around $134.00 easing some of the shock over the sudden rise. Still, investors are worried that food and energy costs will continue to grow, especially after data showed euro zone inflation at a new record.

Striking truckers and construction workers protesting against high fuel costs and low wages in South Korea weighed on the country's benchmark share index, in a stark example of the human toll of soaring energy prices.

The US dollar slipped against the euro and yen, as investors reconsidered the likelihood that the Federal Reserve would raise borrowing costs still giving mixed signals.

That dampened enthusiasm about a three-day rally in US tech-sector shares, dragging down Tokyo Electron Ltd., the second-largest maker of semiconductor equipment in the world, and Samsung Electronics.

"Caution is the word," said Peter Vann, head of investment research at Constellation Capital Management in Sydney. "The impact of higher petrol prices and interest rates causing a bit of slowdown in discretionary spending is certainly having an impact."

Japan's Nikkei share average was up 0.1 percent after gaining 2.7 percent the prior day.

South Korea's KOSPI slipped 0.7 percent, with shares of companies involved with construction broadly lower a day after the country's construction workers joined striking truckers.

Early gains on Taiwan's TAIEX fizzled, causing the index to fall 0.8 percent on losses in technology shares.

Financial sector shares in Japan and South Korea firmed after results from US brokerage Lehman Brothers Holdings Inc. did not contain any surprises, giving investors hope that Goldman Sachs Group Inc. and Morgan Stanley will at least meet expectations when they announce their earnings later this week.

Lehman had forecast last week that it would post a $2.8-billion loss.

The euro rose to an 11-month high against the yen above 167.80 yen on expectations the European Central Bank will almost certainly have to raise interest rates to fight price pressures.

"Yesterday's inflation print support our expectations that the ECB will be forced onto a hawkish path for longer than anticipated, and continued gains in short-term yields will be supportive for the euro, as hikes even beyond July are possible," said Ashley Davies, currency strategist with UBS in Singapore.

The euro rose 0.4 percent against the dollar, at $1.5522. Against the yen, the dollar slipped 0.2 percent to 107.95 yen snapping a three-day rally.