Oil Tops $102 as Iran Signals Escalation; U.S. Yields Climb Despite Treasury Support

Oil prices climbed above $102 a barrel on Tuesday after signals from Tehran that it is prepared to intensify the conflict, reviving concerns over Middle East supply disruption and firming risk premia across commodity and financial markets.

Despite stepped‑up Treasury purchases — Treasury Secretary Bessent has increased buybacks to $6 billion from $2 billion — long‑term U.S. yields continued to move higher, underscoring skepticism among investors about the efficacy of the intervention. The benchmark 10‑year yield jumped as high as 4.86%, pressuring rate‑sensitive assets and denting risk appetite.

U.S. equities fell for a third straight session as markets balanced the impact of rising yields and mounting geopolitical tensions. Futures pointed to modest losses at the open as traders awaited fresh economic releases and corporate results that could further sway sentiment.

On the campaign trail in Texas, former President Donald Trump pledged a one‑time $5,000 dividend for every American adult if Republicans capture both the House and the Senate in November’s midterms — a fiscal proposal that officials estimate would cost about $1.3 trillion. The pledge injected an additional layer of political and fiscal uncertainty into market deliberations over growth and interest‑rate trajectories.

In Europe, Intesa Sanpaolo won shareholder approval to issue new shares to help finance its EUR 35.4 billion takeover of rival Monte dei Paschi di Siena, a deal set to reshape Italy’s banking landscape and test investor appetite for large domestic consolidation in a fragile credit environment.

Investors are also focused on a slate of data and corporate results due this week. Both the Producer Price Index and Consumer Price Index will be parsed for fresh inflation signals ahead of the Federal Reserve’s next meeting, while Oracle’s quarterly report will be watched closely for indications of corporate demand for AI‑related technology spending.

Regional markets showed a mixed picture: European and Japanese stocks traded broadly flat, while Chinese indexes slipped between 0.5% and 1%, weighed by export and growth concerns. The coming sessions are likely to hinge on whether oil moves higher on renewed Iran tensions and whether U.S. yields stabilize as policy makers and markets reassess the durability of demand and the effectiveness of Treasury interventions.