Platinum Tumbles as Traders Reduce Risk on Middle East Tension

(Bloomberg) — Platinum fell by the most in more than three years as market tightness began to ease and conflict in the Middle East prompted global investors to reduce risk.

Israel launched strikes across Iran, targeting nuclear facilities and killing top military commanders in a major escalation against its chief adversary. Most risk-on assets including industrial metals pushed lower in response, with platinum prices tumbling as much as 6.4% Friday, the biggest intraday drop since March 2022.

The white metal is responding to news out of the Middle East, said Nicky Shiels, head of metals strategy at Geneva-based MKS PAMP SA. 

The price contraction came as the metal, used in jewelry and auto catalysts as well as in the chemical and glass industries, had rallied as much as 12% earlier this week as robust Chinese demand and tight market conditions fueled bullish sentiment.

Many analysts thought prices had risen too far, too fast to hold. 

“A sustained breakout is unlikely,” Lina Thomas of Goldman Sachs Group Inc wrote on Thursday, predicting spot platinum prices likely would fall back to the $800-$1,150-an-ounce range, where they have remained for most of the last decade. 

“Chinese buying appears highly price sensitive and tends to fall when prices are high,” Thomas wrote, adding she expects stable-to-moderately higher global platinum supply unless South African power constraints re-emerge, along with continued pressure on auto sector demand.

This month’s spike in prices was in part driven by availability of the physical metal. Spot prices for platinum also are trading well above futures, another sign of tightness. 

That tightness was in part thanks to a dramatic outflow of platinum from the main trading hubs of London and Zurich to the US in the first few months of 2025 over fears imports would be subject to US President Donald Trump’s tariffs. 

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