Iran's Gold Jewelry Demand Rises to 4-Year High, Bucks Oil Slump

(Bloomberg) -- Iran's gold jewelry demand climbed to a four-year high in the first quarter, as the rest of the Middle East was hurt by low oil prices.

An improving economy helped Iran's jewelry demand climb 27 percent from a year earlier to 12.9 metric tons in the first three months this year, the World Gold Council said in a report Thursday. Iran's gold bar and coin demand was 3.7 tons, the most for the region, compared with sales of 0.3 ton.

“Demand across the rest of the region remained weak in the face of low oil prices and subdued tourist numbers, the impact of which was exaggerated by rising gold prices,” the World Gold Council said.

Gold advanced 8.9 percent in the first quarter from the end of December, as investors snapped up the precious metal amid political discord in the U.S. and Europe that halted gains in equity markets. Brent crude declined 7 percent over the same period amid a glut.

Total Middle East consumer demand, including bars, coins and jewelry, rose 5 percent to 64.5 tons, the highest since the third quarter of 2015, according to the report. While Saudi Arabia was the biggest gold market in the Middle East last year, the United Arab Emirates showed the most usage in the first quarter at 17.2 tons, down 2 percent from a year earlier. In Saudi Arabia, the total dropped 13 percent to 14.2 tons while Egypt's consumption declined 14 percent to 6.2 tons, the WGC said.

To contact the reporter on this story: Claudia Carpenter in Dubai at ccarpenter2@bloomberg.net.

To contact the editors responsible for this story: Nayla Razzouk at nrazzouk2@bloomberg.net, Claudia Carpenter, Jesse Riseborough