[MARKET ANALYSIS] Energy continues to drive yields higher across the curve

The transmission channel here is the classic one: a crude spike on geopolitical escalation feeds breakevens and term premium, and in past episodes of this kind the selloff has been led by the inflation-sensitive parts of the curve, with the bear-steepening stateside versus belly-led pressure in Europe reflecting different policy-rate anchors. The split between OATs and Bunds is the more idiosyncratic story: energy shocks have historically widened French spreads when a fiscal narrative is already in place, since the market treats energy exposure as a compounding factor for an existing fiscal concern rather than a standalone driver, and the OAT-Bund spread has been the cleanest expression of that. Gilts sit in their usual position as the most energy-beta of the major curves, and pre-budget periods have tended to amplify that sensitivity as any inflation pass-through collides with the fiscal arithmetic. Waller's hawkish shift fits the established pattern of single-official commentary moving the front end only modestly unless it signals the committee's centre of gravity shifting. Worth watching is whether crude holds the gains into the next sessions, since energy-driven rate selloffs have historically faded when the geopolitical premium unwinds, and whether the OAT-Bund widening persists as a fiscal rather than energy story.