NEW YORK — A powerful global bond selloff deepened on Thursday, driven by a surge in oil prices and a disappointing first outing for the U.S. Treasury’s expanded buyback program, as investors confronted the prospect of renewed inflation pressure from fresh U.S.-Iran strikes.

The benchmark 10-year Treasury yield climbed to its highest level since 2023, while the policy-sensitive 2-year yield also rose as oil topped $100 a barrel. Global oil prices later hit $108 per barrel, according to market data cited by several outlets, extending a rally that has rattled bond markets from Asia to Europe and the United States.

A buyback that failed to soothe

At the center of the U.S. selloff was the Treasury Department’s first expanded buyback operation under Secretary Scott Bessent. Bloomberg reported that the department bought fewer bonds than expected, a result that undermined hopes the program would improve liquidity and signal official concern about rising yields.

MSN framed the outcome bluntly: “Treasury yields surge after Bessent’s beefed-up buyback operation fails to calm market.” The headline captured the mood. Instead of reassuring investors, the smaller-than-anticipated purchase reinforced worries that the Treasury is cautious about draining its cash balance or that dealers are unwilling to part with bonds at current prices.

‘Treasury yields surge after Bessent’s beefed-up buyback operation fails to calm market’ — MSN headline

Yahoo Finance offered a different lens, reporting that the Treasury’s $950 billion cash account is seen as a potential funding source for a buyback surge. That framing highlights the fiscal plumbing behind the operation: the government has ample cash, but deploying it in a way that calms markets is far from straightforward.

Oil and geopolitics

The immediate trigger for the latest wave of selling was a renewed round of U.S.-Iran strikes, which sent oil prices sharply higher. Global bonds extended their selloff as the conflict raised fears of supply disruptions in the Middle East. Brent and other global benchmarks touched $108 per barrel, while U.S. crude topped $100.

Higher energy costs feed directly into headline inflation, threatening to undo some of the disinflation progress that had allowed investors to anticipate Federal Reserve rate cuts. That, in turn, pushes yields higher as traders demand more compensation for holding fixed-income assets.

“Global bond yields surge as oil prices fuel inflation worries,” one MSN headline read, summarizing a dynamic that has become familiar in 2024 and 2025: geopolitical shocks can quickly transmit into financial conditions.

Waiting for wholesale inflation data

Before Thursday’s rout, some markets had steadied as investors awaited key wholesale inflation data. The producer price index report is now even more critical. A hot reading would validate the bond market’s fears; a soft one could offer temporary relief.

But the combination of $100-plus oil and a messy buyback operation has already shifted the tone. Traders are repricing the path of Fed policy, with futures markets reducing the odds of near-term rate cuts. The 10-year yield’s move to its highest since 2023 marks a significant technical break, one that could spill over into mortgage rates, corporate borrowing costs and equity valuations.

How different outlets see it

• Bloomberg Markets emphasized the mechanics: surging oil, inflation fears and a Treasury buyback that bought fewer bonds than expected.
• MSN ran a series of headlines tracking the yield surge, the 10-year high, the global bond selloff and oil’s move to $105 and $108.
• Yahoo Finance focused on the Treasury’s $950 billion cash account as a potential source of funding for future buybacks.
• Other market coverage highlighted the 2-year yield’s rise as oil topped $100, a sign that investors are adjusting expectations for Fed policy rather than just long-term inflation.

The competing frames matter. For Bloomberg, the story is about a policy tool that misfired. For MSN, it is a market-wide yield spike with oil as the accelerant. For Yahoo, it is a fiscal capacity story: the Treasury may have the cash to intervene more aggressively, but the first operation’s small size raised doubts about execution.

Why it matters

Bond yields are the discount rate for the global economy. When they rise this quickly, they tighten financial conditions without the Fed lifting a finger. U.S. consumers face higher mortgage and auto-loan rates. Companies confront more expensive refinancing. Emerging markets, already sensitive to dollar strength, can see capital outflows accelerate.

The episode also tests the Treasury’s ability to manage the market’s plumbing. Buybacks are designed to improve liquidity and support smooth functioning, not to cap yields. But in a moment of stress, investors read every operational detail as a signal. The smaller-than-expected purchase suggested the Treasury is not yet willing to go big, even with a $950 billion cash account.

Globally, the selloff is a reminder that the inflation fight is not over. Oil’s jump to $108 is a tax on growth and a boost to price pressures. If the U.S.-Iran conflict escalates further, energy markets could remain elevated, keeping bond yields under upward pressure.

For now, the market’s message is clear: geopolitics, oil and fiscal policy are colliding. The next test comes with the wholesale inflation data, but the Treasury’s buyback operation has already failed to calm a jittery market.