Gold Prices Remain Stable Amid Decline in Oil Amid Uncertainty Over Iran Conflict

Global Markets Stabilize as Gold Prices Steady Amid Oil Price Volatility

May 21, 2026 - The global market has seen a stabilization of gold prices on Thursday, following a 1% low earlier in the session. This comes as crude oil prices have fallen due to uncertainty over a resolution to the U.S.-Israeli war on Iran. A softer dollar and lower yields have also contributed to the support of bullion.

Spot gold has seen a 0.1% increase to $4,547.54 per ounce as of 02:04 a.m. ET (1804 GMT). U.S. gold futures for June delivery have settled 0.1% lower at $4,542.50. The price of gold has fallen more than 14% since the war started in late February, which has disrupted maritime traffic through the Strait of Hormuz, lifting energy prices and stoking inflation concerns.

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The dollar has pared earlier gains, making greenback-priced bullion cheaper for other currency-holders. The U.S. 10-year Treasury bond yields have fallen 0.2%, decreasing the opportunity cost of holding non-yielding bullion. This has made gold a more attractive option for investors.

Despite being seen as an inflation hedge, gold tends to struggle in periods of elevated interest rates. Traders now see a 58% chance of at least one 25-basis-point interest rate hike by the U.S. Federal Reserve this year, compared with 48% a day earlier, as per CME's FedWatch Tool. This increase in interest rate hike expectations has put pressure on gold prices.

The market is now cautious, with traders expecting a bit of a cautious trade initially. The U.S.-Israeli war with Iran remains a major concern, with agreements often falling apart. The uncertainty surrounding this conflict has led to a volatile trading session, with oil prices whipsawing throughout the day.