Key Highlights

  • Precious metal advanced more than 1% following Iran’s declaration allowing commercial vessels through the Strait of Hormuz during the ceasefire period
  • President Trump revealed a 10-day Israel-Lebanon ceasefire agreement and indicated the US and Iran are nearing a comprehensive deal
  • Crude oil experienced significant declines, with Brent futures tumbling 8.3% following the foreign minister’s statement
  • Bullion is poised for its fourth consecutive weekly advance, despite trading approximately 9% below pre-conflict price levels
  • Speculative funds reduced their net long exposure on the precious metal to the weakest position in more than two years

Spot gold markets moved higher to $4,843.17 per ounce during Friday’s morning session, registering a 1.1% increase after Iran’s foreign minister Abbas Araghchi announced via X that the Strait of Hormuz would permit passage for all commercial vessels throughout the ceasefire duration.

Micro Gold Futures,Jun-2026 (MGC=F)
Micro Gold Futures,Jun-2026 (MGC=F)

The strategic waterway handles approximately one-fifth of global oil and gas transportation. The strait’s functional blockade following the late February outbreak of hostilities triggered the most severe energy supply disruption on record, propelling crude oil values significantly higher.

Brent crude futures declined 8.3% in response to Araghchi’s announcement. American equity futures expanded their advances following the development.

President Trump disclosed a 10-day ceasefire arrangement between Israel and Lebanon on Thursday. Israeli Prime Minister Benjamin Netanyahu provided confirmation of the agreement.

Trump indicated that Iran had accepted conditions regarding nuclear weapons that Tehran had previously rejected, stating that Washington and Iran are approaching a complete agreement. He mentioned Iran has committed to maintaining non-possession of nuclear weapons for a period exceeding 20 years.

Iran has requested the lifting of international sanctions as part of the arrangement. Trump expressed willingness to extend the ceasefire duration if diplomatic progress with Tehran continues.

Discussions between Washington and Tehran could potentially restart as soon as this weekend, Trump indicated. Several European and Gulf Arab officials have projected that finalizing a comprehensive agreement might require up to six months.

Impact on Precious Metal Markets

Gold faced downward pressure throughout much of the seven-week period since hostilities commenced. Elevated oil prices generated inflation concerns, prompting market participants to anticipate central banks maintaining or increasing interest rates. The precious metal typically underperforms during periods of elevated interest rates.

The US dollar gained strength throughout the conflict period, partially because substantial domestic energy exports insulated the American economy from supply chain disruptions. Dollar strength increases gold costs for international buyers using alternative currencies. The dollar index headed toward a 0.5% weekly decline on Friday.

Bullion has staged a recovery in recent weeks while remaining approximately 9% below late February levels when the conflict initiated.

Federal Reserve Bank of New York President John Williams stated Thursday that prevailing uncertainty complicates providing definitive rate guidance, though he continues to anticipate reductions over an extended timeframe.

Speculative Fund Positioning Reaches Two-Year Low

Speculative funds decreased their net long exposure on gold to the weakest level in over two years during the week concluded April 7, based on recent data releases.

Ole Hansen, head of commodity strategy at Saxo Bank, noted the reduced positioning “decreases the potential for additional long liquidation” while establishing capacity for renewed purchasing activity if market conditions remain favorable.

Gold futures contracts traded at $4,865.09 per ounce during Friday’s morning session in New York, recording a 1.2% daily gain. Silver advanced 0.7% to $78.96 per ounce.