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Mediocre 5Y Auction Tails As Foreign Demand Slides
After yesterday's solid 2Y auction, today's 5Y auction was an uglier mirror image.
The sale of $70BN in 5 year paper priced at a high yield of 4.200%, up from 4.182% in May and the highest since Jan 25. It tailed the When Issued 4.193% by 0.7bps, and was the 8th consecutive tail for the 5Y tenor.
The bid to cover was 2.351, better than the 2.340 in May and the highest since October.
The internals, however, a disappointment: Indirects took down just 61.60%, a big drop from 74.85% in May and the lowest since January. And with Directs jumping to 25.51% from 12.34% in May - the highest since January - dealers were left with 12.9, the highest since March.
Overall, this was a rather disappointing auction, and one which pushed yields fractionally higher from the lows of the day, although considering the big slide in the 10Y from 4.49% this morning to just over 4.40% we doubt too many will lose sleep.
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"Real Alien Shit!": Downed US Pilot Reported Seeing Iranian Drones Swarm in 'Jellyfish' Formation
Authored by Antiwar.com via Dave DeCamp
CNN has reported that the pilot of a US F-15 fighter jet that was shot down over Iran during the US-Israeli bombing campaign in April reported seeing a swarm of Iranian drones in a formation that resembled a jellyfish before he ejected from the aircraft.
Sources told the outlet that the pilot reported what he believed he saw to US intelligence officials, setting off a debate within US intelligence agencies about Iran's potential drone capabilities.
Iranian state mediaAbove: Photo of wreckage of US aircraft in Isfahan, Iran, that was released by Iranian media after the US said it rescued two airmen who were on the F-15 shot down over Iran.
The report noted that the pilot was concussed during the incident, and US intelligence officials disagreed on whether he could recount what he saw clearly.
Describing the pilot's account, one source said: “Multiple drones interconnected and moving as one with smaller drones below the bigger drones like legs. Real alien sh*t.”
If Iran is able to control multiple drones in a formation like what the pilot described, it would mean its drone capabilities are far more advanced than what the US assessed.
During the full-scale war, the Pentagon admitted to Congress that Iran’s drones were more difficult to deal with than expected and that US forces were struggling to intercept them.
The F-15 pilot who recounted the incident was one of the airmen rescued by US special forces in Iran. According to the US military’s account, the pilot quickly recovered while the weapons systems officer, who was also aboard the F-15, took much longer to find.
A U.S. pilot who was shot down reported seeing flying Iranian drones swarm in a “jellyfish” formation. Cultural anthropologist Dr. Peter Skafish joins @LelandVittert to discuss the validity of the report. pic.twitter.com/PIrjo5VwcX
— NewsNation (@NewsNation) June 24, 2026The US lost multiple aircraft during the incident, including two C-130s and two MH-6 “Little Bird” helicopters. Iranian officials alleged that the operation may have been a failed attempt to seize Iran’s enriched uranium.
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Moscow Oil Refinery Faces Six-Month Shutdown After Relentless Ukrainian Drone Attacks
Moscow's largest oil refinery is expected to remain out of service for at least six months after suffering significant damage in a series of Ukrainian drone attacks this month, according to Reuters, citing sources familiar with the matter, after Zelensky earlier vowed to bring the war to Russian territory. Kiev and the West are flirty with massive Russian retaliation at this point, which is precisely what Putin has vowed.
The refinery is located on the southern outskirts of the Russian capital and a major fuel supplier to the whole region. It was struck at least twice before this month - as dramatic and intense eyewitness videos captured - forcing operations to halt. Meanwhile via Newsquawk:
Russia has reportedly asked for 50k tonnes of gasoline from Kazakhstan to help ease domestic fuel shortages, according to sources.
Several attacks on Moscow refinery in a matter of days, via AFP"Repairs will take at least six months," one source said, describing the extent of the damage at the Moscow Oil Refinery.
The Gazprom Neft operatd facility processed 11.6 million metric tons of crude oil in 2024 and produced roughly 2.9 million tons of gasoline and 3.2 million tons of diesel fuel, according to public data.
It comes at a sensitive moment Russia continues to grapple with fuel supply challenges. At the moment, the Crimean peninsula is witnessing unprecedented government restrictions on selling gas to civilians, as well as half the population suffering an electricity blackout due to major Ukrainian drones strikes on Kerch port, and in particular damage to the large thermal power plant there.
Also, Russian Deputy Prime Minister Alexander Novak said this week that Moscow is considering a ban on diesel exports to stabilize domestic markets amid emerging shortages.
Ukraine's Security Service (SBU) previously claimed responsibility for a June 16 strike that reportedly damaged the refinery's primary oil-processing unit, described by Ukrainian officials as the plant's "heart." That's when the facility first reportedly suspended operations following the attack.
Two days later, Ukraine launched another large-scale drone assault on Moscow. Russian authorities reported hundreds of drones targeting the capital, resulting in fires at multiple locations.
Since international crude oil prices surged following the war in the Middle East centered on Iran, Russia has boosted its oil revenues as not only prices have jumped - but Russian oil was made desirable in India again - thanks to American waivers for sales of Russia’s crude already loaded on tankers in connection to easing the global crisis due to the Iran war.
Some reports have suggested Russian 'friendly fire' initially hit the Moscow refinery, the result of errant local anti-air missiles:
Rather than back down in the face of Moscow's new threats of "massive group strikes" on Ukraine, it seems Ukrainian forces are flexing with yet more attack waves.
The Kremlin has long believed that Ukraine can't accomplish such sophisticated long-distance strikes on its own, but that it has had significant targeting help from US and Western allied intelligence.
Tyler Durden Wed, 06/24/2026 - 12:40