UK 30-year borrowing costs hit highest since 1998 amid oil price surge and political uncertainty

UK long-term borrowing costs rose to their highest level since 1998 on Tuesday, with 30-year gilt yields moving to around 5.76%-5.79%.

The move came as oil prices surged, pushing up inflation expectations, while traders also pointed to political uncertainty in the UK ahead of local elections. Guardian live coverage first flagged the move early in the day, and later market coverage from the Wall Street Journal put the yield at about 5.79%.

The Bank of England had already warned in its April 30 Monetary Policy Report that conflict in the Middle East had lifted global energy prices and increased UK inflation risks. That context matters because higher energy prices can feed directly into borrowing costs if investors expect inflation to stay sticky.

The issue is important for the Treasury because long-dated gilt yields influence the government's financing costs and shape how expensive it is to borrow over time. For now, traders are watching to see whether the move holds or eases as the trading day continues.

The difference between the reported 5.76%-5.79% levels appears to reflect timing rather than disagreement about the underlying market move.