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Gold prices drop as rising oil prices and stronger dollar weigh on precious metal
Higher oil prices could continue to fuel concerns that inflationary pressures may prove more persistent than previously expected, pushing Treasury yields higher across the curve
- PUBLISHED: Thu 12 Mar 2026, 9:36 AM
[Editor's Note: Follow Khaleej Times live blog amid US-Israel-Iran war for the latest regional developments.]
Gold prices dropped Dh4 per gram on Thursday morning as the US dollar strengthened and oil prices rose above $100 a barrel.
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The 24K gold price opened at Dh619.75 per gram on Thursday, down from Dh623.75 on Wednesday.
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Among other variants of the precious metal, 22K, 21K, 18K, and 14K were trading at Dh574.00, Dh550.25, Dh471.75, and Dh368.00 per gram, respectively.
Spot gold was trading at $5,146.9 per ounce, down 0.49 per cent. Silver was also trending down, trading at $84.92 per ounce, down 0.49 per cent.
The US dollar firmed 0.3 per cent on Thursday, making dollar-priced bullion more expensive for holders of other currencies.
"I think the US dollar strength and interrelated rates story is a slight headwind for gold despite the actual violence that’s taking place, which is otherwise supportive of gold," Nicholas Frappell, global head of institutional markets at ABC Refinery, told Reuters.
Importantly, high oil prices are hurting gold gains because they dampen hopes for near-term interest rate cuts by the US Federal Reserve.
Van Ha Trinh of Exness said higher oil prices may increase inflation fears and push Treasury yields up. The 10-year yield rose above 4.16 per cent, showing caution as the Fed may stay wary.
“Expectations moved toward only one rate cut later this year, and another in the middle of next year. A more cautious approach from investors and the Federal Reserve could continue to push Treasury yields higher, supporting the dollar,” said Trinh.
