Kuala lumpur: The ongoing attack against Iran by the United States and Israel has driven investors toward safe-haven assets, pushing global gold prices up to US$5,500 per ounce, said an analyst. SPI Asset Management managing partner Stephen Innes said bullion did not ease into the weekend; instead, it reacted immediately when reports confirmed that US fighter jets had landed in Israel.
According to BERNAMA News Agency, Stephen Innes noted that the development marked a crucial moment where the geopolitical narrative shifted from rhetoric to a visible military posture, which markets tend to price in rapidly. With Friday's close of US$5,278.51 per ounce, gold had already moved ahead of the early escalation risk. Historical data shows that during supply-shock-driven episodes, such as the Strait of Hormuz closure or the targeting of Middle East oil infrastructure, gold tends to move in tandem with crude oil.
Innes explained that typically, gold rises by about 0.20 to 0.35 percent for every one percent gain in oil prices. Applied to current levels, this means gold is trading at an upside of US$125-US$220, putting a US$5,400-US$5,500 projection well within statistical reach if crude oil confirms sustained disruption risk or even a US$10 added gap open. He emphasized that the precious metal is not chasing oil for growth optimism but is reacting to implications about inflation expectations, real yields, and systemic stress.
Bank Muamalat Malaysia Bhd chief economist Dr. Mohd Afzanizam Abdul Rashid added that the ongoing escalations in the Middle East are weakening the US dollar's position as a safe-haven currency, giving gold and other precious metals a slight advantage. He mentioned that precious metals like gold serve as the best alternatives or substitutes for safe-haven instruments, as their value is not tied to politics. Despite this, he warned that it is going to be a risk-off mode, especially in the global equities market.
Domestically, Dr. Mohd Afzanizam stated that higher gold prices positively impact the Ar Rahnu business. The increase in collateral value can improve access to finance for micro, small, and medium enterprises (MSMEs) to fund their working capital.
The price of physical gold was fixed at US$5,167.35 per troy ounce at the London Bullion Market Association afternoon fix on February 26, 2026. Reports on Saturday indicated that Israel launched airstrikes against sites inside Iran, marking a sharp escalation in the conflict. US President Donald Trump confirmed that the US had initiated 'major combat operations in Iran' alongside Israel, following a significant US military build-up in the region aimed at pressuring Tehran over its nuclear activities amid ongoing large-scale protests.