Global bullion flows face major disruption as war in the Middle East halts most air traffic through Dubai, a critical hub handling 20 per cent of worldwide gold shipments. The suspension affects both African-mined gold refined in the UAE and European-to-Asian transit routes, creating potential price volatility in Asian markets.

John Reade of the World Gold Council noted that gold availability concerns caused Indian prices to swing sharply from a $50 per troy ounce discount to parity with London prices within days. Gold has dropped 3 per cent this week to around $5,100 per troy ounce but remains nearly 20 per cent higher year-to-date. Dubai ranked as the world's second-largest gold exporter in 2024, with India as its primary destination.

Rhona O'Connell of StoneX warned that India faces the greatest impact since Dubai serves as a key entrepot for precious metals bound for Indian markets. While short-term workarounds exist, prolonged disruption could create significant market instability. The situation compounds existing volatility from Chinese retail investor demand that has driven silver inventories to 10-year lows, creating additional pressure on global bullion logistics.