Escalating Tariff Wars, Tighter African Supply Drive Gold Toward $3000 Milestone

Gold has been one of the best-performing assets of 2025. The precious metal reached an intraday high of $2,882 per ounce as investors sought a haven amid geopolitical, economic, and supply-side factors.

The escalating global trade war, particularly the tit-for-tat tariff exchange between the U.S. and China, has fueled demand for gold as a hedge against economic uncertainty. Heightened fears led to week-long queues for physical gold withdrawals as the Bank of England struggled to meet the delivery of physical bullion.

"Tariffs increase uncertainty, particularly for industries reliant on stable energy costs, such as manufacturing, transportation, aviation, and logistics," deVere Group CEO Nigel Green said on Saturday.

Supply disruptions in Africa, particularly Mali, have only added to the tightness of the gold market. The fourth-largest gold producer has undergone a restructuring of its mining sector under its military junta. The government has demanded a greater share of mining revenues, leading to disputes with foreign operators like Barrick Gold GOLD and Resolute Mining.

In November 2024, Mali's junta issued an arrest warrant for Barrick Gold CEO Mark Bristow and detained four other executives amid stalled negotiations over back taxes and alleged money laundering.

At the same time, they detained Resolute CEO Terry Holohan for a week before the company agreed to pay $160 million and adopt Mali's new mining code. Following a two-month personal leave, Holohan resigned.

Barrick's Loulo-Gounkoto mine, its largest gold operation after Nevada's Carlin mine, has been at the center of the dispute, as the firm temporarily halted operations in January. Bristow acknowledged progress in talks but noted, "We're making progress, not as fast as I would expect."

Meanwhile, newly elected Ghanaian President John Mahama has vowed to "reset the country" by tackling illegal mining, which has devastated the environment and hit cocoa farms as collateral victims. These activities added to cocoa market troubles as supply shortages almost tripled prices in 2024.

Mahama's reforms aim to curb these practices, but the transition could temporarily shrink the output of a key African supplier that produced four million gold ounces in 2023.

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