Gold prices surged back above $5,100 per ounce on Wednesday, February 4, 2026, with silver jumping 5%, as escalating military tensions between the United States and Iran triggered a flight to safe-haven assets. The immediate catalyst was a confrontation in the Arabian Sea, where the U.S. Navy confirmed it had shot down an Iranian drone that had aggressively approached the USS Abraham Lincoln aircraft carrier.
The price action was dramatic. Spot gold rose 2.3% to $5,060.28 per ounce, while gold futures for April delivery climbed 2.9% to $5,078.96 per ounce on the COMEX. Silver futures followed, reaching $87.343 per ounce. This recovery marked a sharp reversal from a historic selloff the previous week, which saw gold plummet over $1,000 from its record peak of nearly $5,600 per ounce on January 29.
The geopolitical flare-up occurred against a delicate diplomatic backdrop. Despite the military incident, back-channel nuclear talks between the U.S. and Iran were reportedly scheduled for that Friday in Oman, aimed at de-escalating the broader crisis and potentially reviving the 2015 nuclear deal (JCPOA).
Analysts pointed to a mix of short-term and long-term drivers. "Safe‑haven demand, ongoing central‑bank buying, and the outlook for real rates remain supportive over the medium term," said Ewa Manthey, commodities strategist at ING Group. The rally was also supported by dip-buying after the sharp correction. However, significant outflows were noted, particularly from China's four largest gold-backed ETFs, which saw a record single-day decline of nearly $1 billion on Tuesday.
Institutional outlook remained largely bullish. Deutsche Bank maintained its $6,000 per ounce forecast for gold, while Goldman Sachs cited upside risk to its year-end target of $5,400. OCBC analysts characterized the selloff as a normalization from overheated levels, maintaining end-2026 targets of $5,600 for gold and $133 for silver. The market also continued to factor in expectations for at least two Federal Reserve interest rate cuts in 2026, which typically benefits non-yielding assets like bullion.
