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Commerzbank Says Oil Climbs as Middle East De-Escalation Less Likely, Treasuries Keep Recent Highs, Yen Extends Losses

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Brent crude climbed above $92 a barrel as the US and Iran continued exchanging fire in the Middle East and as chances of a diplomatic solution fade for now, according to Commerzbank in a note. Treasury yields are holding near their recent peak levels.

President Donald Trump threatened to target an Iranian nuclear facility while dismissing the prospects for renewed negotiations as tensions in the Red Sea escalated, said Commerzbank. Secretary of State Marco Rubio said Iran is "not serious" about negotiations.

Meanwhile, at least four tankers carrying Saudi crude reversed course after Houthi threats, underscoring mounting risks to regional shipping, the FT reported.

The House of Representatives passed a stopgap funding bill, lowering the immediate threat of a US government shutdown, said the bank. Also in the US, President Trump plans to impose 100% tariffs on generic drug imports starting in 2028, added Commerzbank.

Japan's Nikkei gained, whereas US equity futures traded slightly lower.

The yen stayed under pressure above 163 per US dollar. Japan's finance minister reiterated that authorities are prepared to take "appropriate and bold action" after the currency hit a 40-year low, said Commerzbank.

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