Oil surge pushes US Treasury yields higher ahead of key jobs data

Rising energy costs and geopolitical risk are driving bond investors to demand higher yields, complicating the outlook for the Federal Reserve as the labor market report approaches.

By Handelsavisen Newsroom · Automated 6 August 2026, 19:09 UTC · 1 min read

US Treasury yields climbed to their highest levels in approximately two months on Tuesday, driven by a sharp selloff in global bond markets.

The move was triggered by a surge in crude oil prices, which has intensified in recent sessions amid heightened geopolitical tensions in the Middle East.

7% on Wednesday, marking its highest level since January 2025.

Investors are increasingly pricing in the risk of sustained higher energy costs, which could keep inflation pressures elevated for longer than previously anticipated.

The yield on the 10-year US Treasury note climbed above 4.7% on Wednesday, marking its highest level since January 2025.

This repricing reflects a broader shift in market sentiment as traders weigh the impact of rising oil prices on consumer spending and corporate margins.

The sell-off in bonds comes as oil prices staged a sharp comeback, with Brent crude climbing on fears that infrastructure in the Gulf region could be targeted, according to reports from Iran.