News that breaks before dawn is always the scariest. On February 28 (local time), the United States and Israel launched military strikes against Iran. When the news broke, many markets had not fully reacted yet—but gold moved first. London spot gold surged quickly, and New York gold futures neared USD 5,300 per ounce; crude oil jumped at the same time, with Brent spiking sharply intraday. The candlesticks on the screen looked as if someone suddenly yanked them upward. Many people’s first reaction was—has gold gone crazy again? But the question truly worth asking is not “how much will it rise,” but: this time, is it a fleeting emotion, or another structural turning point of the era?
The Market Moves from “Worry” to “Confirmation”
Over the past few months, U.S.–Iran relations have remained tense. Negotiations have been on and off, but the market has consistently treated it as a “high-risk backdrop,” rather than an immediate reality about to erupt. This time is different. Once military action actually materialized, the nature of the risk changed—from “might happen” to “has already happened.”
Financial markets are extremely sensitive to this shift. Gold rises, oil surges, stocks come under pressure—this is almost a textbook reaction path. We have seen similar scenes in history: the Gulf War, the Iraq War, the Soleimani incident… each time a major conflict breaks out, gold tends to spike rapidly in a short window. Because in moments of panic, capital is not looking for returns, but for safety. And gold is the oldest safe asset.
Crude Oil’s True Pressure Point
Even more sensitive than gold is crude oil. This time, everyone’s attention is focused on one place—the Strait of Hormuz. This narrow strait carries about 30% of the world’s seaborne oil shipments. If navigation is disrupted, the world could face a supply gap of tens of millions of barrels per day. What the market fears most is not the airstrikes themselves, but a break in the supply chain. If the conflict remains a limited confrontation, oil prices may rise in a pulse-like burst; but if the strait is blocked, the logic of oil prices will change completely, inflation expectations will reawaken, and global central banks will be thrown into a new dilemma.
So far, the oil-price rise is more of a “geopolitical premium.” But everyone is waiting—will the conflict continue to escalate?
Gold—Is This Time Really Just About Safe-Haven Demand?
Many people attribute this rally simply to risk-off sentiment. But if you use “safe-haven” alone to explain gold’s trajectory over the past two years, it is actually not enough. In recent years, gold’s rise has gradually detached from traditional logic. Under the textbook framework: when real rates are high, gold should be under pressure; when the dollar strengthens, gold should pull back. But reality has been that even during periods of high real rates, gold has continued to climb steadily. Because the market is re-evaluating something deeper—the credit of the U.S. dollar and the global monetary system.
In the past few years, central banks around the world have continuously increased their gold holdings, and the dollar’s share in global foreign-exchange reserves has continued to decline. Gold is no longer just a “risk hedge tool”; it is returning to an even older role—the anchor of the monetary system. In other words, the underlying tone of this gold price is not only the Middle East conflict. Geopolitical conflict is just the match. The real fuel is the shift in the global credit structure.
In the coming days, the market will be highly dependent on where the conflict goes. If the conflict is contained within a limited scope, the risk-off premium may gradually be digested and gold may chop at elevated levels; if the situation spreads and energy facilities are affected, gold and crude will strengthen together; if it escalates into all-out confrontation, the pricing logic of global assets will be rewritten. In the short term, watch intensity; in the long term, watch structure. And the long-term structure has, in fact, already been changing. Global debt is at historical highs, the Federal Reserve has entered an easing cycle, central banks continue buying gold, and geopolitical risk is becoming long-term. These factors—war or no war—are also supporting a rising center of gravity for gold.
In the face of violent volatility, what matters most is not prediction, but control. Gold is suitable as part of an asset allocation, not as an all-in wager. In an era of uncertainty, holding an appropriate amount of gold is hedging risk, not chasing windfall profits. Current prices are already high, and volatility will be amplified. Conflict pricing is often non-linear: it can rise fast, and it can fall back fast too. Position discipline is more important than predicting direction.
Middle East fighting has ignited the market, and gold is once again under the spotlight. But if you only see the surge and ignore the structural changes behind it, you will misread the essence of this move. In the short term, gold rises because of war; in the long term, it rises because of the era. The storm will eventually pass, but changes in the credit system are the longer story. This time, gold may not be just emotion—it looks more like a signal of the times.
[Disclaimer]: The above content reflects analysis of publicly available information, expert insights, and BCC research. It does not constitute investment advice. BCC is not responsible for any losses resulting from reliance on the views expressed herein. Investors should exercise caution.