Oil Near $95 as Middle East Conflict Pressures Bonds
Oil prices hovered near $95 a barrel amid renewed U.S.-Iran strikes, adding pressure to global bond markets. Although European afternoon trade saw some easing in Treasury yields after earlier multiyear highs, investors continued pricing in the likelihood of a Federal Reserve rate hike this month. The market currently assigns a 63% probability to such an increase according to LSEG data. Eurozone bonds also faced significant sell-offs with German Bund and U.K. government bond yields reaching their highest levels since 2011 and 2007, respectively. This occurred during the G-20 finance ministers' meeting in North Carolina. Despite assurances from Treasury Secretary Scott Bessent that Gulf oil would bypass Hormuz within two years, tensions remain high. Equity markets showed mixed performance with U.S. stock futures down slightly and Asian indices falling sharply due to declines among major chipmakers like Samsung Electronics and SK Hynix.
Topics: bond_markets middle_east_conflict oil_prices treasury_yields