Iran Tensions Drive Oil Prices Towards $102, Gold Falls

The escalation of tensions between Iran and the US has sent oil prices soaring towards $102 per barrel, while gold is experiencing a decline in value.

The increased risk of conflict in the region has led to higher supply risks for Brent crude, pushing its price up through resistance at $94.83, with the immediate target being a retest of $102.00 and then $104.23.

On the other hand, gold is experiencing a decline due to the inflation consequences of higher oil prices, which are raising expectations of higher interest rates, making it more expensive to hold bullion.

The current market response is driven by the rate channel overpowering geopolitical demand for gold, with the potential for a self-reinforcing cycle of US strikes, Iranian retaliation, and further escalation.