Gold prices surged above the $4,500-an-ounce mark on Thursday, while silver rallied more than 2%, as a sharp decline in crude oil prices boosted demand for precious metals following fresh signs of a possible diplomatic breakthrough in the US-Iran conflict.
Spot gold was trading at $4,500.84 per ounce at 18:16:01 IST, up $66.34, or 1.50%, according to real-time market data. Silver climbed to $74.4615 per ounce at 18:15:21 IST, gaining $1.7205, or 2.37%.
Domestic bullion prices also advanced. On the Multi Commodity Exchange (MCX), gold rose Rs 1,706, or 1.08%, to trade higher as of 18:24 IST on June 4. Silver gained Rs 3,653, or 1.39%, as of 18:25 IST.
The move came as global crude oil prices fell sharply after US President Donald Trump signalled that negotiations aimed at ending the conflict with Iran had entered their final phase.
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“We're in the middle of final negotiations to end the Iran war,” Trump said, expressing confidence that diplomatic efforts could soon produce an agreement.
The comments followed the passage of war powers resolution in the US House of Representatives seeking to limit Trump's authority over military action against Iran. The president dismissed the vote as “meaningless” and maintained that diplomacy remains on track.
Oil markets reacted positively to the prospect of de-escalation in West Asia. Crude prices tumbled as traders reassessed the risk of supply disruptions from one of the world's most important oil-producing regions.
The decline in oil prices helped support bullion, which often benefits when easing energy costs reduce inflationary pressures and weaken demand for inflation hedges linked to commodities. Investors also rotated into precious metals amid expectations that lower oil prices could improve the broader macroeconomic outlook.
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