Oil price jumps and markets slide after Trump warning to Iran

Risk-off surge in oil and geopolitically driven inflation fears should support safe-haven metals even though the immediate market reaction is a stronger dollar. Brent jumped more than 7% to above $108.50/bbl after Trump warned of harder strikes on Iran, while equities sold off and 10y UK gilt yields rose 4bp to 4.886% as markets repriced an energy shock and longer-delayed Gulf supply disruption. The key cross-asset read-through for gold is stagflationary: higher energy prices, weaker growth, and rising consumer-price pressure typically underpin bullion demand, even if the dollar’s almost 0.5% gain against major currencies is a near-term headwind. The article cites IG’s Chris Beauchamp saying markets are now pricing in “hundreds of millions of barrels of oil” not coming out any time soon, with investors shifting back toward “economic catastrophe” pricing. Near term, watch whether crude sustains above the $108.50/bbl area and whether the dollar’s safe-haven bid extends; both will influence XAU direction intraday. For gold, the setup is constructive on a multi-session basis if the Middle East risk premium persists, but rallies may be capped by firmer USD and higher nominal yields unless equity selling broadens further.