Gold crosses ₹1.02 lakh as Middle East conflict rattles global markets; oil sees biggest jump since 2020

Gold prices in India hit a record high of ₹1,02,055 per 10 grams in Ahmedabad on Friday, June 13, 2025, marking an unprecedented milestone for the precious metal amid global commodity market volatility. On the Multi Commodity Exchange (MCX), gold settled at ₹1,00,276, reflecting sustained demand from investors fleeing to safety amid deepening geopolitical turmoil.

Internationally, the yellow metal hovered around $3,432.90 per ounce, continuing its upward trajectory as markets reacted sharply to a widening crisis in the Middle East.

“Gold prices touched a new high and scaled past ₹1 lakh-mark per 10 gram while in the international markets the bullion soared past $3,440 per ounce as investors flocked to safe-haven assets amid mounting global instability,” said Rahul Kalantri, Vice President, Commodities at Mehta Equities Ltd.

He cited Israel’s pre-emptive strike on Iran, escalating U.S. trade uncertainty, and softer inflation data in the U.S. as the primary drivers of the rally. “Additionally, weaker-than-expected U.S. inflation data strengthened expectations for further Fed rate cuts, enhancing gold's appeal.”

Manav Modi, Senior Analyst at Motilal Oswal Financial Services, added that the geopolitical escalation has reignited risk aversion across markets. “Gold marked an all-time high of ₹1 lakh on the domestic front and hovered close to $3500, as investors sought safe-haven assets after Israel's strike on Iran heightened Middle East tensions. Geopolitical tensions escalated after Israel struck Iran as tensions mounted over U.S. efforts to halt Iran's production of atomic bomb materials.”

He also pointed to mixed signals from U.S. economic data, stronger-than-expected CPI, slightly hotter PPI, and an eight-month high in jobless claims, which have contributed to uncertainty over the Fed’s rate trajectory. “Dollar index and US Yields also inched lower amidst the economic data points. Focus today will be on US Michigan consumer sentiment,” he noted.

The geopolitical repercussion wasn’t limited to bullion. Crude oil surged by as much as 12% to $77.62 per barrel, its biggest single-day gain since May 2020, following Israel’s direct assault on Iran’s nuclear and missile infrastructure.

“Geopolitical tensions are heating up, and it's impacting the oil market! Israel's airstrikes on Iran have sparked fears of supply disruptions, causing crude oil prices to surge. The market is now on high alert, waiting to see how Iran will respond. The concern is that the situation could escalate into a full-blown regional crisis, with significant implications for global oil supplies. In a worst-case scenario, the Strait of Hormuz could be shut down, putting 20 million barrels per day of supply at risk.  Prices have already jumped 10%, and any further escalation could push them up another 8-9%,” said Navneet Damani, Group Senior VP and Head of Commodities Research at Motilal Oswal.

Kaynat Chainwala, AVP–Commodity Research at Kotak Securities, flagged concerns over major disruptions in oil supply chains. “On Friday, oil prices surged as much as 12% to $77.62 per barrel, marking the largest single-day gain since May 2020. The sharp rally followed Israel’s targeted strike on Tehran’s nuclear and ballistic missile facilities, significantly increasing the risk of Iranian retaliation. Fears of a potential closure or limiting passage through the Strait of Hormuz, a critical oil transit chokepoint that handles nearly 20% of global oil flows, have raised concerns over major supply disruptions,” she said.

However, crude oil remains 6.24% lower compared to the same time last year, based on trading data from a contract for difference (CFD) that mirrors the benchmark market.

Back in the bullion market, technical indicators suggest further volatility ahead. “In the international market, gold prices are expected to find support near $3,380, with resistance at $3,465. Domestically, key levels are seen at ₹99,000 for support and ₹1,01,450 as resistance. Given the recent sharp rally and heightened volatility driven by escalating geopolitical tensions, it is advisable to adopt a wait-and-watch approach before taking new positions,” Kalantri advised.

With global markets now on edge, the coming days may prove decisive, both for commodity prices and for the broader geopolitical climate that is fuelling their dramatic moves.