At 10:30 (AEST), the benchmark ASX 200 index edged down 5.60 points, or 0.08 percent, to 6,739.80, while the broader All Ordinaries index was down 9.30 points, or 0.13 percent, at 6,977.30.
A fresh lockdown in Europe and a slower vaccination schedule were shifting investors' thinking away from peak optimism of maximum support and fast economic recovery.
"The announcement of an Easter lockdown in German increased demand fears for crude oil, and sent major contracts into freefall," CMC Markets chief market strategist Michael McCarthy said.
"The concerns about the outlook for the European economy spread to other risk assets, knocking shares lower and reversing recent strength in base metals."
On the local bourse, energy stocks suffered the most, which was down 1.27 percent. Materials also shed 0.65 percent.
In the financial space, the big banks were mixed with Commonwealth Bank up (0.98 percent), National Australia Bank up (0.04 percent), Westpac Bank down (0.90 percent) and ANZ up (0.11 percent).
Mining stocks were mostly lower with BHP down (0.33 percent), Rio Tinto unchanged, Fortescue Metals down (1.65 percent) and gold miner Newcrest down (1.23 percent).
The country's oil and gas producers slumped with Oil Search down (2.70 percent), Santos down (1.26 percent) and Woodside Petroleum down (1.27 percent).
Australia's largest supermarkets lifted with Coles up (0.38 percent), and Woolworths up (1.13 percent).
Meanwhile telecommunications giant Telstra improved (0.45 percent), the national carrier Qantas slumped (2.11 percent) and biomedical firm CSL strengthened (0.30 percent).
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