Eurozone Bond Yields Fall as Oil Drops

Bond yields in the eurozone fell on Tuesday as oil prices dropped. Markets reacted to reports that talks involving Oman and Iran on the future of shipping through the Strait of Hormuz were at an advanced stage. Oil prices fell as prospects for an agreement eased concerns about supply disruptions.

Iran says it is nearing an agreement with Oman on new shipping arrangements. At the same time, however, it continues to demand that the United States meet its conditions, including compensation. US President Donald Trump, on the other hand, said Iran should pay compensation for people killed in wars, attacks and protests.

The yield on 10-year German bonds fell by two basis points, while the yield on two-year bonds also declined. Italian and French bond yields saw similar falls.

However, tensions persist. The Strait of Hormuz remains closed and energy flows in the Middle East continue to be disrupted.

(Reuters, mja)