European gasoil is up 98% since the Middle East conflict began, compared with 36% for Brent. Of the 99-basis-point rise in US 10-year yields through 21 September, 90 basis points came from real yields.
LONDON, 24 September 2026 – Easing crude prices risk obscuring where the energy shock is still intensifying. New analysis from Permutable shows European diesel prices have nearly doubled since the conflict began on 28 February, while the rise in US long-term borrowing costs has come overwhelmingly through real yields.
ICE gasoil rose from $753 to $1,490 a tonne between the last close before the conflict and 23 September. Over the same period, Brent rose 36%. The European distillate refining margin widened from $28 to $101 a barrel. Diesel’s role in freight, farming and construction makes that divergence more relevant to business costs than the crude benchmark alone.
Permutable’s Global Macro Sentiment Indices track the information flowing through each stage of the shock: shipping risk, energy prices, inflation and monetary policy. Its shipping-risk measure now stands 3.1 standard deviations above its trailing-year norm for Saudi Arabia, compared with 0.3 for Iran, drawing attention to the routes used to bypass the Strait of Hormuz. Saudi Arabia’s East–West pipeline restarted at a low rate this week following the September drone attack, but a full return to capacity could take several weeks.
The pressure has yet to spread broadly through UK prices and wages. In its September decision, the Bank of England said there was little evidence so far of material second-round effects, while warning that the risk rises the longer high energy prices persist. It held Bank Rate at 3.75% by a 6-3 vote and projected UK inflation slightly above 4% in the first quarter of 2027.
Permutable’s policy-outlook index nevertheless remains 3.0 standard deviations above its norm for Germany, 1.9 for the UK and 1.4 for the US. These readings measure the strength of policy-related coverage relative to each market’s own history; they are not forecasts of central-bank decisions.
The bond market shows why the distinction matters. From 27 February to 21 September, the US 10-year nominal yield rose 99 basis points to 4.96%. The real yield accounted for 90 basis points of that move, reaching 2.68% – its highest level since November 2008. Inflation compensation accounted for the remaining nine basis points.
“Crude is only one price in this story,” said Jack Watson, Market Analyst at Permutable. “Diesel shows where the supply squeeze is still acute. The next question is whether those costs reach wider prices and wage settlements. Meanwhile, the rise in real yields shows that borrowing conditions have already changed. Our indices let us follow those pressures as they develop, rather than waiting for every stage to appear in official data.”
Permutable will continue to track four key developments into 2027 using its Global Macro Sentiment Indices: a sustained recovery in Hormuz traffic and Saudi export capacity; a narrowing of the diesel refining margin; Europe’s gas-storage drawdown; and whether coverage of food, services and wages begins rising alongside energy. The last would be an early indication to investigate possible second-round effects, rather than evidence that they have already occurred.
