By: Creamer media

Gold prices rose for a fifth consecutive session on Tuesday, as investors aggressively sought safe-haven assets. Spot gold surged to $5,345.56 per ounce, with some intraday reports peaking even higher as the market reacted to the escalating situation. This rally is a direct response to the deepening air war between the U.S., Israel, and Iran, which has fueled fears of a protracted regional conflict. While a strong U.S. dollar typically pressures gold, both are currently being bought as safe-havens due to the extreme level of global uncertainty and the risk of a wider economic shock.

The UAE retail market saw a substantial jump in gold rates across all carats on Tuesday morning. The price for 24-carat gold rose to AED646.50 per gram, while 22-carat gold increased to AED598.75. Other variants followed the upward trend with 21-carat reaching AED574.00, 18-carat hitting AED492.00, and 14-carat gold trading at AED383.75. These local increases reflect the global flight to safety as domestic buyers and investors move to secure physical assets amidst regional instability.

Chokepoint crisis in the Strait of Hormuz

A major catalyst for the current market volatility is the status of the Strait of Hormuz. Following Iran’s explicit warnings that the waterway is closed, the Islamic Revolutionary Guard Corps (IRGC) has threatened to fire on any vessel attempting passage. This blockade threatens roughly 20 percent of global oil and gas flows, leading to a near-total halt in maritime traffic as insurers cancel coverage for the region. The potential for a total energy shutdown has sent crude prices higher and further cemented gold’s status as the primary hedge against geopolitical collapse.

Industrial metals face recession

While gold and silver have benefited from the flight to safety, with spot silver edging higher to $89.29 per ounce, other industrial precious metals have faced downward pressure. Platinum and palladium both saw losses on Tuesday as investors braced for a potential slowdown in industrial demand should the conflict lead to a broader recession. Meanwhile, U.S. President Donald Trump has warned of further military actions, suggesting that the current volatility is unlikely to subside soon. The ongoing closure of regional airspace and disruptions at major hubs like Dubai International Airport continue to complicate physical supply chains for the bullion and gemstone trade.