Oil surge pushes yields higher globally

• Treasury yields reached multi-year highs as rising oil prices increased inflation concerns.
• Brent crude traded near $107 per barrel after reaching a four-month high of $109.97.
• Investors increased expectations for further central bank tightening amid higher inflation risks.

Treasury yields climbed and Asian shares declined on Friday as higher oil prices increased inflation concerns and pushed investors to reassess global interest rate expectations.

Brent crude reached a four-month high of $109.97 per barrel before falling 0.6% to $107, while the benchmark remained on track for an 11% weekly gain.

"Markets are finally starting to price in the risk of a protracted war," said Helima Croft, head of global commodity strategy at RBC Capital Markets.

The 10-year U.S. Treasury yield increased as much as 3 basis points to 4.9790%, its highest level in three years, while the 30-year yield rose to 5.3836%.

Following the market move, the 10-year Treasury yield was 4.9790% and Brent crude traded near $107 per barrel.

Two-year Treasury yields reached a 14-month high of 4.5961% as investors increased expectations that the U.S. Federal Reserve may raise interest rates to address inflation pressures.

Global bond markets also declined, with Australia’s three-year government bond yield reaching 5.01% and Japan’s 10-year government bond yield rising to 2.98%.