Gold and Silver Prices Plummet up to 5% Amid Crude Oil Surge Following Escalation in US-Iran Conflict

Global Markets Shaken as US-Iran Tensions Escalate

The ongoing US-Iran war has sent shockwaves through global markets, with gold and silver rates experiencing a sharp sell-off on Monday. As of 4:00 PM IST, the COMEX gold rate is oscillating around $4,535/oz, logging an intraday loss of nearly 2.30%. Meanwhile, the MCX gold rate has shed over ₹1,500 per 10 gm and slipped below the ₹1,50,000 levels.

Similarly, the COMEX silver rate has corrected nearly 5% to around $72.60/oz, while the MCX silver rate has lost over ₹6,200 per kg and slipped below ₹2,45,000 per kg. Market experts attribute this sell-off to the news of Iran firing two missiles at a US warship, which has escalated tensions in the region.

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According to market experts, the US administration is yet to respond to this news, and until any response comes from the White House, the COMEX gold rate is expected to trade in the $4,500 to $4,600 per ounce range, while the COMEX silver rate is expected to remain in the $70 to $75 per ounce range. The MCX gold rate is expected to trade in the ₹1,47,000 to ₹1,52,000 per 10 gm range, while the MCX silver rate is expected to trade in the ₹2,40,000 to ₹2,50,000 per kg range.

The sharp sell-off in gold and silver rates can be attributed to the soaring crude oil prices, which have risen over 5% to $107 per barrel, while the Brent crude oil price has come close to $120/bbl. This rise in crude oil prices has strengthened the petrodollar, fueling hawkish US Fed speculations, leading to profit-booking in the bullion across bourses.

Kaynat Chainwala, AVP — Commodity Research at Kotak Securities, believes that energy costs risk prompting central banks to hold interest rates elevated longer, adding pressure on non-yielding bullion. Both metals slipped to near one-month lows last week on a hawkish Fed stance, with three officials dissenting against softening language in the April FOMC statement, effectively pricing out 2026 rate cuts.

"With the Iran standoff unresolved and rate cuts off the table, the near-term risk skew for bullion remains firmly to the downside," said Kaynat Chainwala of Kotak Securities.

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Market experts are expecting high volatility in the gold and silver rates, with Anuj Gupta, a SEBI-registered market expert, expecting the gold rate to remain in the $4,500 to $4,600/oz range, while the silver rate is expected to trade in a broader $68 to $78 per ounce range.

The US-Iran standoff has been escalating, with Iran's navy preventing "American-Zionist" warships from entering the Strait of Hormuz on Monday, state TV reported. The Fars news agency said two missiles had hit a US warship near Jask on the Gulf of Oman after it ignored Iranian warnings. The United States has not yet responded to these reports.