Mujtabah makes his first public statement; dollar strengthens, gold falls slightly.
2026-03-12 22:24:13
On Thursday (March 12) during the US trading session, spot gold prices edged lower, trading at $5,157.73.39 per ounce. COMEX gold futures for April delivery (GCcv1) fell 0.3% to settle at $5,163.6 per ounce.
In his first public statement since taking office, Iran's new Supreme Leader Mojtaba Khamenei declared that the Strait of Hormuz should remain closed and threatened to open a new front in the war. This exacerbated market concerns about continued disruptions to supplies through this critical global oil chokepoint. US Treasury yields and oil prices surged, stocks fell, and the dollar index reached a new intraday high.
The US dollar index strengthened for the third consecutive trading day, reaching 99.5598, up 0.30%. As a highly competitive safe-haven asset, the appreciation of the US dollar increases the cost of gold purchases for holders of non-US dollar currencies.
Developments in the situation in Iran
Oil tanker attacks near Iraq escalate Middle East crisis
Dubai reports multiple drone attacks, one of which resulted in injuries.
Oman's ports resumed normal operations after being suspended for several hours.
The International Energy Agency (IEA) says the conflict has triggered the largest oil supply disruption in history.
The United States will release 172 million barrels of oil to support the IEA's contingency plan.
The IEA projects that global oil production will fall by 8 million barrels per day in March, the lowest level since 2022.
Global bonds have given back all gains made in 2026 as war exacerbates inflation anxieties.
Iran says a ceasefire depends on a commitment from the US and Israel to refrain from further attacks.
India is negotiating with Iran to secure safe passage for its oil tankers.
As the shipping crisis worsens, European natural gas prices rise in line with oil prices.
Key points from the International Energy Agency (IEA) report
The conflict in Iran has triggered the worst oil supply shock in history. The International Energy Agency released a report today stating that oil production has fallen to a four-year low due to the conflict, and the global oil market is experiencing the largest supply disruption in history.
With the Strait of Hormuz virtually impassable, Gulf oil-producing countries have reduced their daily production by at least 10 million barrels. The IEA projects that global oil production will fall by 8 million barrels per day in March, a drop of more than 7% from approximately 107 million barrels per day in February.
Iraq, Qatar, Kuwait, the UAE, and Saudi Arabia have all significantly reduced production, but increased production from Kazakhstan, Russia, and other non-OPEC+ oil-producing countries will partially offset the decline in output in the Gulf region. Saudi Arabia and the UAE are diverting some exports to ports outside the Gulf. IEA data shows that Saudi Arabia's daily exports via western ports reached a record high of 5.9 million barrels on March 9; the average daily flow along this route is projected to be only 1.7 million barrels by 2025.
The United States launches a Section 301 investigation.
This is the first of several broad trade investigations launched by the Trump administration, paving the way for new tariffs. This is a core move in its effort to replace tariff policies overturned by the Supreme Court.
U.S. Trade Representative Jamison Greer announced on Wednesday that the U.S. would launch investigations into more than a dozen major economies under Section 301 of the Trade Act, focusing on the so-called "overcapacity in manufacturing."
Bloomberg reports that such investigations, which typically take months to complete, are a legal prerequisite for the president to unilaterally impose tariffs on countries found to have engaged in unfair trade practices. The economies under investigation include several of the United States' largest trading partners: China, the European Union, Mexico, India, Japan, South Korea, Taiwan, as well as Switzerland, Norway, Indonesia, Singapore, Thailand, Malaysia, Cambodia, Vietnam, and Bangladesh.
"We believe that capacity expansion by our major trading partners has become significantly detached from the actual drivers of domestic and international market demand," Greer said in a teleconference. Canada was not among the first countries to be investigated.
Institutional Views
Philip Streibel, chief market strategist at Blue Line Futures, said: "Gold prices have been trading in a range recently. A stronger dollar, rising US Treasury yields, and the lack of expectations for interest rate cuts are bearish factors, but the conflict in the Middle East is attracting safe-haven inflows, providing support."
"If oil prices can be prevented from rising further, gold prices are expected to rise... Once crude oil prices fall, US Treasury yields may decline, the dollar may give back some of its gains, and gold futures prices will also rise."
Two oil tankers caught fire in Iraqi waters, clearly an escalation of Iranian-related attacks that cut off Middle Eastern energy supplies and contradict US President Trump's claim that "the war launched two weeks ago has been won."
As a result, oil prices soared, global stock markets fell, and market hopes for a quick de-escalation of the situation were completely dashed.
Rising oil prices will increase transportation and production costs, exacerbating inflation. Gold is seen as an inflation hedge, but high interest rates will increase the attractiveness of interest-bearing assets, putting downward pressure on gold prices.
In addition, spot silver rose 1.6% to $87.19 per ounce. Silver prices are projected to rise over 146% throughout 2025.
BMI analysts predict in their report that the average price of silver will reach $93 per ounce in 2026. Strong investment demand will solidify the gains in 2025, offsetting the drag on demand for solar panels and jewelry from rising silver prices.
In his first public statement since taking office, Iran's new Supreme Leader Mojtaba Khamenei declared that the Strait of Hormuz should remain closed and threatened to open a new front in the war. This exacerbated market concerns about continued disruptions to supplies through this critical global oil chokepoint. US Treasury yields and oil prices surged, stocks fell, and the dollar index reached a new intraday high.
The US dollar index strengthened for the third consecutive trading day, reaching 99.5598, up 0.30%. As a highly competitive safe-haven asset, the appreciation of the US dollar increases the cost of gold purchases for holders of non-US dollar currencies.
Developments in the situation in Iran
Oil tanker attacks near Iraq escalate Middle East crisis
Dubai reports multiple drone attacks, one of which resulted in injuries.
Oman's ports resumed normal operations after being suspended for several hours.
The International Energy Agency (IEA) says the conflict has triggered the largest oil supply disruption in history.
The United States will release 172 million barrels of oil to support the IEA's contingency plan.
The IEA projects that global oil production will fall by 8 million barrels per day in March, the lowest level since 2022.
Global bonds have given back all gains made in 2026 as war exacerbates inflation anxieties.
Iran says a ceasefire depends on a commitment from the US and Israel to refrain from further attacks.
India is negotiating with Iran to secure safe passage for its oil tankers.
As the shipping crisis worsens, European natural gas prices rise in line with oil prices.
Key points from the International Energy Agency (IEA) report
The conflict in Iran has triggered the worst oil supply shock in history. The International Energy Agency released a report today stating that oil production has fallen to a four-year low due to the conflict, and the global oil market is experiencing the largest supply disruption in history.
With the Strait of Hormuz virtually impassable, Gulf oil-producing countries have reduced their daily production by at least 10 million barrels. The IEA projects that global oil production will fall by 8 million barrels per day in March, a drop of more than 7% from approximately 107 million barrels per day in February.
Iraq, Qatar, Kuwait, the UAE, and Saudi Arabia have all significantly reduced production, but increased production from Kazakhstan, Russia, and other non-OPEC+ oil-producing countries will partially offset the decline in output in the Gulf region. Saudi Arabia and the UAE are diverting some exports to ports outside the Gulf. IEA data shows that Saudi Arabia's daily exports via western ports reached a record high of 5.9 million barrels on March 9; the average daily flow along this route is projected to be only 1.7 million barrels by 2025.
The United States launches a Section 301 investigation.
This is the first of several broad trade investigations launched by the Trump administration, paving the way for new tariffs. This is a core move in its effort to replace tariff policies overturned by the Supreme Court.
U.S. Trade Representative Jamison Greer announced on Wednesday that the U.S. would launch investigations into more than a dozen major economies under Section 301 of the Trade Act, focusing on the so-called "overcapacity in manufacturing."
Bloomberg reports that such investigations, which typically take months to complete, are a legal prerequisite for the president to unilaterally impose tariffs on countries found to have engaged in unfair trade practices. The economies under investigation include several of the United States' largest trading partners: China, the European Union, Mexico, India, Japan, South Korea, Taiwan, as well as Switzerland, Norway, Indonesia, Singapore, Thailand, Malaysia, Cambodia, Vietnam, and Bangladesh.
"We believe that capacity expansion by our major trading partners has become significantly detached from the actual drivers of domestic and international market demand," Greer said in a teleconference. Canada was not among the first countries to be investigated.
Institutional Views
Philip Streibel, chief market strategist at Blue Line Futures, said: "Gold prices have been trading in a range recently. A stronger dollar, rising US Treasury yields, and the lack of expectations for interest rate cuts are bearish factors, but the conflict in the Middle East is attracting safe-haven inflows, providing support."
"If oil prices can be prevented from rising further, gold prices are expected to rise... Once crude oil prices fall, US Treasury yields may decline, the dollar may give back some of its gains, and gold futures prices will also rise."
Two oil tankers caught fire in Iraqi waters, clearly an escalation of Iranian-related attacks that cut off Middle Eastern energy supplies and contradict US President Trump's claim that "the war launched two weeks ago has been won."
As a result, oil prices soared, global stock markets fell, and market hopes for a quick de-escalation of the situation were completely dashed.
Rising oil prices will increase transportation and production costs, exacerbating inflation. Gold is seen as an inflation hedge, but high interest rates will increase the attractiveness of interest-bearing assets, putting downward pressure on gold prices.
In addition, spot silver rose 1.6% to $87.19 per ounce. Silver prices are projected to rise over 146% throughout 2025.
BMI analysts predict in their report that the average price of silver will reach $93 per ounce in 2026. Strong investment demand will solidify the gains in 2025, offsetting the drag on demand for solar panels and jewelry from rising silver prices.
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