* Iran conflict widens to Lebanon
* Dubai gold flows curbed as flights halted due to strikes
* Spot gold up about 23% this year
* Silver slips over 5% (Updates prices)
March 2 (Reuters) – Safe-haven gold rose on Monday in response to concerns of a prolonged conflict in the Middle East following U.S. and Israeli strikes against Iran.
Spot gold was up 0.4% at $5,297.31 an ounce by 1831 GMT, having pared some gains as profit-taking set in after the metal rose more than 2% earlier in the session. Prices hit a record of $5,594.82 on January 29.
U.S. gold futures settled 1.2% higher at $5,311.60.
The U.S. dollar index rose 1%, making bullion priced in dollars more expensive for other currency holders.
“Right now, the market is attempting to figure out whether these attacks are going to be followed up over the next several weeks,” said David Meger, director of metals trading at High Ridge Futures. “I think it’s that uncertainty that is more than likely to support prices.”
AIR WAR EXPANDED ON MONDAY The U.S.-Israeli air war against Iran expanded with no end in sight, as Israel attacked Lebanon in response to strikes by Hezbollah and Tehran kept up its missile and drone attacks on Gulf states. President Donald Trump said a “big wave” of further attacks was imminent, without giving details.
Oil and gas prices surged as strikes forced shutdowns of oil and gas facilities across the Middle East and disrupted shipping in the crucial Strait of Hormuz.
Analysts at SP Angel said that rising geopolitical fragmentation has prompted BRIC central banks to reduce their exposure to dollar-denominated assets in favour of gold, adding that they expect this theme to continue. Meanwhile, BNP Paribas said it expects physical gold investment demand will be a big driver this year.
Gold, long regarded as a safe asset in times of uncertainty, has notched multiple record highs and climbed nearly 23% so far this year. The rally builds on its exceptional 64% jump in 2025, fuelled by robust central-bank purchases, strong inflows into exchange-traded funds and a shift toward looser U.S. monetary policy.
According to three metals industry sources, physical gold flows to and from Dubai’s bullion trading hub will be severely curbed in the coming days as airlines cancel flights due to the strikes.
On the data front, the market will monitor the ADP employment report, weekly jobless claims and the non-farm payrolls report this week.
Among other metals, spot silver fell 5.7% to $88.46 an ounce after touching its highest since January 30.
Spot platinum fell 2.7% to $2,300.50 while palladium lost 0.9% to $1,770.66. (Reporting by Ashitha Shivaprasad in Bengaluru Additional reporting by Noel John and Kavya Balaraman; Editing by David Goodman, Barbara Lewis and Sahal Muhammed)
