Gold jumps amid Middle East conflict fears

March 04, 2026 (MLN): Gold prices climbed more than 1% on Wednesday, rebounding from a more than one week low hit in the previous session, as escalating U.S. Israeli air strikes against Iran and heightened geopolitical uncertainty supported safe-haven demand.

Currently, spot gold is down 2.91% to $5,170.06 an ounce as of [9:20 am] PST, according to data reported by Mettis Global.

On Tuesday, bullion had fallen over 4% to its lowest level since February 20, pressured by a firmer U.S. dollar and fading expectations of near-term rate cuts amid mounting inflation concerns linked to a potentially prolonged Middle East conflict, as reported by Reuters.

Yesterday, gold extended its gains as intensifying U.S.- and Israel-led military action against Iran drove investors toward traditional safe-haven assets.

Concerns that the conflict could evolve into a drawn-out regional war fueled uncertainty across global markets and strengthened demand for bullion.

Iranian media reported yesterday that the Strait of Hormuz had been closed, warning that Iran would open fire on any vessel attempting to cross the vital shipping route.

The move threatened to disrupt nearly 20% of global oil flows, raising fears of a sharp spike in crude prices and broader inflationary pressures.

Global oil and gas prices surged as the war halted energy exports from parts of the Middle East, with Tehran attacking ships and energy facilities, closing navigation in the Gulf, and forcing production stoppages from Qatar to Iraq.

The disruption exacerbated investor concerns about rising inflation and economic instability, further underpinning gold’s appeal.

The U.S. dollar hovered near a more than five-week peak reached on Monday, supported by safe-haven flows and cautious sentiment.

Although a stronger dollar typically weighs on gold by making it more expensive for overseas buyers, both assets attracted inflows amid severe geopolitical stress.

U.S. President Donald Trump said yesterday that the military campaign would continue as long as necessary, reinforcing fears of prolonged instability.

The escalation has drawn the Gulf deeper into conflict, causing civilian casualties in Iran, Israel and Lebanon, disrupting international air travel, and bringing shipping activity in the Strait of Hormuz to a standstill.

Meanwhile, other precious metals also rebounded. Spot silver advanced 3.5% to $84.92 per ounce after plunging more than 8% in the previous session.

Spot platinum rose 2.7% to $2,139.56, while palladium gained 1.6% to $1,673.87.

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