10-Year Treasury Yields Rise Amid Renewed Iran War Uncertainty

Investors weigh conflicting signals on Middle East tensions and their impact on oil prices and bond markets.

Mar. 24, 2026 at 8:42am

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The 10-year Treasury yield rose on Tuesday as renewed volatility in oil markets and lingering Middle East tensions kept investors on edge. The benchmark yield was up more than 3 basis points at 4.37% as of 04:36 a.m. ET, with the 30-year yield and 20-year yield also seeing increases. The move higher in yields came as oil prices rebounded in Tuesday Asian trading, reversing part of the sharp losses seen in the previous session as traders reassessed developments in the Middle East conflict.

Why it matters

Conflicting headlines about potential talks between the U.S. and Iran have reinforced uncertainty, keeping both energy and rates markets sensitive to developments. Easing tensions and lower oil prices had briefly supported Treasurys earlier in the week, but renewed uncertainty is once again weighing on sentiment.

The details

Oil had initially slumped on Monday after U.S. President Donald Trump said Washington and Tehran had held "very good and productive conversations" toward ending hostilities, adding that he had ordered a five-day pause on planned strikes against Iran's energy infrastructure. However, the rebound in crude prices on Tuesday suggests markets remain unconvinced that tensions will ease quickly, particularly after Iranian officials denied that any talks had taken place.

  • On Monday, oil prices slumped after President Trump's comments about talks with Iran.
  • On Tuesday, oil prices rebounded in Asian trading, reversing some of Monday's losses.

The players

Donald Trump

The President of the United States who said Washington and Tehran had held "very good and productive conversations" toward ending hostilities.

Iranian officials

Officials from Iran who denied that any talks had taken place between the U.S. and Iran.

Ian Lyngen

The head of U.S. rates strategy at BMO, who noted that "headline risk remains particularly elevated as the war continues without a clear off-ramp" and that U.S. rates are likely to take their primary cue from swings in energy prices until there is greater clarity on the conflict.

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What they’re saying

“Headline risk remains particularly elevated as the war continues without a clear off-ramp.”

— Ian Lyngen, Head of U.S. Rates Strategy, BMO

The takeaway

The ongoing uncertainty around the Middle East conflict and its impact on oil prices is creating volatility in the Treasury market, with yields fluctuating as investors weigh conflicting signals about the potential for de-escalation. The bond market will likely continue to be sensitive to developments in the energy sector until there is more clarity on the geopolitical situation.