Gold prices face turbulence as oil, Fed risks increase

Global gold prices face significant turbulence due to escalating geopolitical risks and potential shifts in oil markets, according to Thailand's leading gold trader, MTS Gold. The firm warns that a renewed escalation of hostility between the United States and Iran could trigger a sharp decline in gold prices, potentially pushing them down to between $3,600 and $3,800 per ounce.

This forecast is particularly sensitive to oil price movements. If crude oil prices surge to the $90-$100 per barrel range and remain at that elevated level for more than a month, the downward pressure on gold would intensify. Such a scenario would not only impact international markets but also significantly affect domestic gold prices in Thailand, with gold bars potentially falling to 60,000 baht per baht-weight.

The interconnectedness of global energy markets and safe-haven assets like gold means that geopolitical instability, especially in the Middle East, can create volatile conditions. MTS Gold's analysis highlights the delicate balance of factors influencing gold's value, emphasizing that both conflict escalation and sustained high energy costs could reshape the precious metal's market.

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Renewed hostility between the US and Iran could cause global gold prices to plunge to US$3,600-3,800 an ounce, or 60,000 baht per baht-weight for domestic gold bar, especially if oil prices rise to $90-100 a barrel and remain at that level for more than a month.