Global gold prices retreated on Monday, dipping to $4,059 per ounce before recovering slightly to $4,074.
The precious metal lost $62.4 from its previous weekend close, marking a decline of more than 1% in the session.
The sell-off in gold coincided with a sharp rise in crude oil benchmarks, driven by intensifying fears of a potential closure of the Strait of Hormuz.
The divergence between gold and energy markets highlights the shifting risk appetite among traders.
While geopolitical tensions typically bolster safe-haven assets like gold, the immediate threat to global energy supply has taken precedence, driving oil prices higher and reviving expectations that central banks may need to maintain elevated interest rates to combat inflationary pressures from energy costs.
This development follows a period of volatility in global crude oil benchmarks.