Oil prices scorch Indian bonds; rising Treasury yields add to pressure

Indian government bond yields rose on Thursday as crude oil prices approached 100 dollars per barrel, with Brent crossing 96 dollars in Asian trade amid escalating Middle East tensions including US strikes on Iran and Houthi attacks on Red Sea tankers. The benchmark 6.94% 2036 bond yield climbed to 6.8180% from 6.8012% on Wednesday, while overnight index swap rates moved 4-5 basis points higher. India, which imports nearly 90% of its crude requirements, faces risks of higher inflation, a weaker rupee and a swollen import bill if oil prices remain elevated.