Oil Prices Soar Above $100 Amid US-Iran Escalation

US-Iran tensions have escalated, driving supply-risk fears and sending crude oil prices above $100. The price of Brent crude topped $101 a barrel for the first time since July, settling more than 3% higher on Wednesday. This surge in oil prices has revived inflation fears, contributing to a decline in US and European equities.

The escalation began with Iran-backed Houthi attacks on Saudi energy facilities, forcing temporary shutdowns. The confrontation widened after Iran warned of further retaliation if US strikes continue. President Trump expects the conflict, and high gasoline prices, to persist beyond the November midterms.

US Treasury yields also rose sharply, despite a new rush higher in crude oil prices and the announcement of expanded Treasury buybacks. The benchmark 2-year treasury yield rose as much as four basis points to trade to a new cycle high near 4.43%, while the 10-year treasury yield rose clear of the recent top of the range to as high as 4.85%, its highest level since late 2023.