Middle East Tensions Lift Gold as Investors Eye Safe Havens

Middle East tensions are propelling gold higher as investors shift capital away from equities and crypto markets toward safe-haven assets. Heightened US-Iran rhetoric over Tehran's nuclear program, combined with a spike in Iranian crude oil exports, has rattled markets on Wednesday. Bitcoin remains caught between competing macro forces, with analysts projecting a slide toward $64,000 or a rally to $69,000 depending on whether dollar strength or inflation fears prevail.

Iran's Oil Surge and Hawkish US Rhetoric Rattle Markets

Iran has dramatically ramped up crude oil shipments from Kharg Island, with exports reaching roughly 20.1 million barrels between February 15 and February 20 -- about three times January's volume, according to reports on Wednesday. The move is seen as a preemptive supply release to hedge against disruption should tensions with the United States escalate.

Increasingly hawkish rhetoric from Washington regarding Iran's nuclear capabilities has amplified expectations of confrontation, according to Bitunix analysts. In a note shared with reporters, the firm projected that a US-Iran military conflict could send gold surging by approximately 15% within two weeks, targeting $5,500 to $5,800 per ounce on safe-haven demand.

In the event of a direct US-Iran military conflict, gold could rise by roughly 15% within two weeks on safe-haven demand, targeting a range of $5,500-$5,800 per ounce.

— Bitunix Analysts

How Do Middle East Tensions Affect Bitcoin Prices?

Bitcoin faces a tug-of-war between dollar strength and inflation hedging as geopolitical risk mounts. If safe-haven capital flows into the US dollar, BTC could slide toward the $64,000-$65,000 zone, Bitunix analysts warned. Should inflation concerns dominate over greenback appreciation, capital could rotate into alternative hedges and push Bitcoin toward $69,000 liquidity levels.

On-chain data from Glassnode paints a cautious picture. Bitcoin continues trading between $60,000 and $70,000 with weak whale accumulation and persistent ETF outflows. The firm's report revealed that nearly 9.2 million BTC are held at a loss, while the 90-day realized profit-to-loss ratio has dropped below 1 -- signaling more holders are selling at a loss than taking profits.

Indian Gold ETF Inflows Hit Record $2.7 Billion

The rotation into safe havens is already visible in global capital flows. Data shared by The Kobeissi Letter on Thursday shows Indian investors are rapidly reallocating into gold products. Gold ETF inflows in India have climbed to roughly 250 billion rupees (around $2.7 billion), an all-time high that has surpassed equity mutual fund inflows for the first time.

Gold ETF demand has risen more than 900% since July, even as stock-fund inflows declined by roughly 170 billion rupees (around $1.9 billion), according to The Kobeissi Letter. As the world's second-largest gold consumer, India's pivot toward gold ETFs marks a fundamental change in capital allocation amid rising geopolitical uncertainty.

As the world's 2nd-largest gold consumer and one of its biggest importers, India's shift toward gold ETFs marks a fundamental change in how its investors are allocating their capital.

— The Kobeissi Letter

What This Means Going Forward

Despite the defensive tilt across markets, US-listed spot Bitcoin ETFs showed signs of recovery on Wednesday as Bitcoin climbed back above $68,000. The funds attracted roughly $506.5 million in daily inflows, the largest single-day figure since early February, putting them on track for their first weekly inflow after five consecutive weeks totaling $3.8 billion in outflows.

The diverging signals -- record gold demand alongside a Bitcoin ETF rebound -- suggest investors are hedging across asset classes rather than making a decisive exit from crypto. Whether Middle East tensions escalate or de-escalate through diplomacy will determine whether gold continues climbing and whether Bitcoin can hold above $65,000 in the weeks ahead.