Gold is being sold at a steep discount in Dubai as the Iran war disrupts flights and hampers suppliers' ability to move bullion out of the key trading hub.
Buyers have stepped back from new orders due to exceptionally high shipping and insurance costs, with traders offering discounts of up to $30/ounce to the global benchmark in London.
Many shipments remain stranded, although some bullion has been loaded onto flights leaving Dubai from the middle of this week.
The United Arab Emirates, and Dubai in particular, is an important centre for refining and exporting bullion to buyers across Asia.
Gold is typically transported in the cargo holds of passenger aircraft, but flights from the UAE are severely restricted due to Iranian missiles.
Traders and logistics firms are reluctant to transport high-value cargoes overland due to risks and complications involved.
Buyers in India can afford to wait, with near-term demand relatively muted and inventories swollen by a large volume of imports in January.
Spot gold has gained nearly a fifth so far this year, but trading has been choppy and the metal has come under pressure this week as the dollar has strengthened.
Refiners are also encountering challenges in sourcing doré—semi-refined gold bars typically cast at the mine site.
