The gold price soared above $3,440/oz on Friday, nearing a record high, after Israel launched an attack on Iranian nuclear and military facilities.
The offensive raised concern about escalating tension in the Middle East, a major oil-producing region, which threatens to add further uncertainty to financial markets.
This drove a surge in safe-haven demand as investors flocked to gold as a hedge against the volatile financial and geopolitical landscape.
At 3pm, the price of bullion was up 1.65% to $3,441.93, while Brent crude oil had leapt almost 8% on mounting fears of supply disruptions.
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Shares in gold mining companies rose sharply amid the favourable metal price environment, with the JSE precious metals and mining index climbing 1.22% by mid-afternoon trade.
At 3.10pm the best performer was AngloGold Ashanti, which rose about 4% to a record high of R897, while Gold Fields climbed 2.72% to a peak of R458.80.
Following close behind was Harmony Gold, which gained 3%. Shares in DRDGold were up 1.7% and Pan African Resource 0.6%.
Citadel director Bianca Botes said the precious metal’s surge “directly followed Israel’s military action against Iran, with Israeli Prime Minister Benjamin Netanyahu confirming that the strikes targeted Iran’s nuclear facilities while acknowledging Iran’s continued ability to respond”.
