Gold futures drop 2.5% as oil spikes 7% after Trump says Iran deal is

Gold futures slid 2.5% to $4,053.32 an ounce while Brent crude surged 7% to $79.30 a barrel after President Donald Trump declared the interim Iran peace agreement “over” at a NATO summit, a move that reignited geopolitical risk premiums and pulled U.S. equity futures lower [1].

Market reaction to the Trump comment

Trump’s statement coincided with a sharp rise in oil prices, lifting Brent crude futures by 7% to $79.30 a barrel and WTI by 6.5% to $75.02 a barrel [1]. The jump erased the recent low‑oil environment that had followed the June preliminary Iran‑U.S. deal, which had kept Brent near $70 and WTI around $66. Higher oil prices revived concerns that energy‑driven inflation could force the Federal Reserve to tighten policy sooner than markets had hoped.

Equity markets reacted in tandem. U.S. stock futures fell, with the Dow down 720 points (‑1.4%), the S&P 500 down 46 points (‑0.6%) and the Nasdaq down 116 points (‑0.5%) by mid‑day [1]. In Canada, the S&P/TSX 60 slipped 29 points (‑1.4%) and the broader S&P/TSX composite fell 518 points (‑1.5%) as investors priced in heightened geopolitical risk [1].

Why gold retreated

The surge in oil and the accompanying rise in the U.S. dollar made non‑yielding assets like gold less attractive. Spot gold was down 1.5% at $4,043.49 per ounce, and gold futures fell 2.5% to $4,053.32 [1]. Analysts noted that a firmer dollar raises the effective price of bullion for foreign buyers, while expectations of higher real yields—driven by potential Fed rate hikes—further depress gold demand [1].

The market now looks ahead to the Federal Reserve’s June meeting minutes, which are due later in the day. The Fed left rates unchanged at 3.5%‑3.75% in its last meeting, but some members signaled possible hikes in 2026, keeping the policy outlook uncertain [1].

What to watch

• Fed minutes release later today for clues on future rate path.
• Oil price movement after the next tranche of Middle‑East tension updates, especially any change in the status of the Strait of Hormuz.
• U.S. dollar index for further strength that could pressure gold and other safe‑haven assets.

The sharp divergence between oil’s rally and gold’s sell‑off underscores how quickly geopolitical statements can reshape risk premiums, leaving markets to balance inflation concerns against the prospect of renewed diplomatic talks. The next few hours will test whether the Fed’s minutes reinforce a hawkish stance or temper expectations for further tightening.