Gold prices rose to fresh highs during Tuesday’s Asian session as geopolitical tensions escalated between the United States and Venezuela and talks to end Russia’s invasion of Ukraine faltered.
Spot gold climbed 3.37% to US$4,486.48 per ounce by 3:30 pm AEDT (4:30 am GMT), breaking records for a second consecutive day.
Silver prices were up 3.76% to $69.67, also a new record. Both gold and silver are set for their strongest annual performance since 1979.
Geopolitical uncertainty “played a critical role” in gold’s price surge this year, wrote Pepperstone research strategist Dilin Wu. Gold often acts as a safe haven asset due to its liquidity and stability, and as a hedge against inflation.
“Persistent tensions across Ukraine, the Middle East, and parts of Southeast Asia continued to disrupt financial systems, trade routes, and supply chains.”
U.S. President Donald Trump said today that “it’d be smart” for Venezuelan leader Nicolás Maduro to resign, as the U.S. continues to pursue the sanctioned oil tanker Bella 1 in international waters near Venezuela.
The U.S. has seized two tankers near Venezuela so far this month, and Trump has called for a blockade of sanctioned tankers entering and exiting the country. It is planning to keep the oil and ships it seizes, according to Trump.
Russia has backed Venezuela, saying “the Russian side reaffirmed its full support for and solidarity with the Venezuelan leadership and people” during talks between the countries’ foreign ministries. China, the largest buyer of Venezuelan oil, also voiced support for its government.
In Ukraine, Russian strikes damaged the port and energy infrastructure in the southern city of Odesa. Ukraine’s military hit an oil terminal and pipeline in strikes on Russian territory, as well as jet fighters and ships.
Ukrainian President Volodymyr Zelenskyy said the U.S.’ revised peace proposal “looks quite solid at this stage” after three days of talks concluded on Sunday, but Russia has said these changes will not improve the likelihood of a peace deal.
Russia is also investigating the possibility that Ukrainian special forces may have been involved with a car bomb that killed a senior Russian general in Moscow. Ukraine has not claimed responsibility for the bombing.
