[MARKET ANALYSIS] Yields climb as energy lifts, OATs and Gilts lag.

Sessions of this kind, where an energy-led repricing lifts yields across the complex, have historically followed a familiar sequence: the inflation impulse hits breakevens first, then drags nominal yields higher with the back end underperforming, which is consistent with the bear-steepening described in USTs. The dispersion across markets is the more telling feature. Gilts have a well-established pattern of outsized sensitivity to energy-driven moves given the UK's import exposure and the fiscal read-through, and budget speculation around energy relief compounds this because relief measures widen the funding requirement at the margin, a channel that has pressured Gilts in comparable episodes. OAT underperformance is a different animal from the energy move: spread widening versus Bunds on French political risk has tended to be event-driven and mean-reverting only once the specific fiscal or coalition catalyst resolves, making the OAT-Bund spread the cleanest expression of that idiosyncratic premium rather than a beta trade. In Germany, coalition negotiations touching pension reform carry supply implications, and past episodes of fiscal loosening expectations have re-priced the Bund curve's term premium before any concrete policy landed. The follow-ons are the FOMC Minutes, which in energy-driven back-ups have mattered mainly for whether officials flag passthrough to inflation expectations, and the 10yr auction, where concession-building into supply has historically amplified a morning's weakness or marked the session's low depending on how the energy leg behaves into the close.