The last time a war-driven oil shock collided with a late-cycle economy was the Gulf War, 1990–92. We line today's market up against that episode from day 0 — the invasion of Kuwait then, the start of the current energy regime (2026-03-01) now — and ask one question leg by leg: is crude driving rates the way it did then? This is a map for conversations about duration and the curve, not a forecast: one historical episode is one path.
| Relationship | 1990 shock | Now, regime to date | Now, last 3 months | Verdict |
|---|---|---|---|---|
| Crude vs the 10-year yield | +0.83 | +0.49 | +0.31 | does not match |
| Crude vs the 2-year yield | +0.49 | +0.51 | +0.45 | matches 1990 |
| Crude vs the 2s10s curve | +0.82 | -0.09 | -0.16 | does not match |
| Crude vs the 2s30s curve | +0.78 | -0.21 | -0.31 | does not match |
| Crude vs the 5s30s curve | +0.72 | -0.33 | -0.45 | does not match |
| Crude vs the 10s30s curve | -0.01 | -0.35 | -0.60 | does not match |
What it says. In 1990, oil up meant the long end sold off while the front end held — the curve steepened with crude. Today the 10-year is behaving the same way (+0.49 now vs +0.83 then): crude is setting the direction of long yields. The curve is not: this time crude is also pulling the 2-year up (+0.51 vs +0.49), so higher oil has meant a flatter curve. The difference is the Fed — in 1990 the market was pricing rate cuts into a recession; today it is pricing a central bank that leans against the oil.
| Horizon | Crude | 10-year | 2-year | 2s10s | 2s30s |
|---|---|---|---|---|---|
| 1 month later | -17% | -43 bp | -38 bp | -5 bp | -7 bp |
| 3 months later | -33% | -76 bp | -85 bp | +9 bp | +14 bp |
| 6 months later | -49% | -83 bp | -104 bp | +21 bp | +23 bp |
| 12 months later | -44% | -143 bp | -208 bp | +65 bp | +90 bp |
| 24 months later | -46% | -240 bp | -399 bp | +159 bp | +243 bp |
One episode is one path (n = 1). Correlations describe how markets have moved together, not what will happen. Educational research — not investment advice.