Gold, silver soar as West Asia conflict deepens after US-Israel strikes on Iran

Gold and silver prices surged sharply on Monday (March 2) as investors rushed to safe-haven assets following coordinated strikes by the United States and Israel on Iran over the weekend, triggering fresh instability across West Asia.

With risk appetite shrinking, funds were pulled out of equities and other volatile instruments and redirected into bullion in both domestic and international markets. The move followed Iran’s retaliatory missile strikes targeting locations in Israel and US military facilities in Qatar, the United Arab Emirates, Kuwait, and Bahrain, raising fears of a broader regional conflict.

Among the dramatic developments reported was the death of Iran’s Supreme Leader, Ayatollah Ali Khamenei, on the opening day of the offensive, further intensifying uncertainty in the region.

Gold, silver rally in India

In India’s physical market, gold prices climbed steeply. The yellow metal rose to Rs 1,73,090 per 10 grams on Monday, up from Rs 1,62,490 in the previous session. Silver also advanced sharply, rising to Rs 2,94,900 per kg from Rs 2,82,140 on Friday (February 27), according to bullion market data.

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The rally adds to gold’s sustained uptrend in recent months, which has been underpinned by geopolitical tensions and shifting diplomatic alignments under US President Donald Trump, alongside persistent global economic uncertainty.

Supply disruptions add pressure

Beyond geopolitical risks, supply-side concerns are adding to price momentum. Physical gold shipments from Dubai — a key trading hub and a major supplier to India — may face disruption due to flight cancellations linked to the conflict.

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Gold imports are typically transported by air owing to security and insurance constraints. Any prolonged disruption in air traffic could tighten domestic supplies and exacerbate price volatility in the near term.

Overseas markets mirror surge

International markets reflected similar strength. Spot gold climbed as much as 2 per cent in early Monday trade to USD 5,368.09 an ounce, its highest level in over four weeks, while US gold futures gained 2.58 per cent to USD 5,382.60 per ounce. Silver prices also firmed, with spot rates rising 1.68 per cent to USD 95.35 an ounce.

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With military escalation, diplomatic uncertainty, and potential supply bottlenecks converging, traders are bracing for continued volatility as developments unfold across the Gulf region.