Shares of iShares Gold Trust Micro fell sharply to $41.40, down 3.2%, as a weekend geopolitical reversal turned the commodity market upside down. President Trump said he was rejecting an Iranian plan to reopen the Strait of Hormuz , a proposal Tehran said would restart peace talks within seven days . The move instantly unwound Friday's oil-price relief and reignited the inflation fears that are gold's worst enemy in a rising-rate world.
Oil Snaps Back, and That Changes the Inflation Math. Brent crude climbed to $106.89 a barrel on Monday, up 2.46% , while WTI rose to $94.10, up 1.83%, after Trump's rejection raised concerns that oil flows through the critical waterway could face further delays . For IAUM holders, costlier oil feeds directly into consumer prices, strengthening the case for tighter monetary policy — which makes gold, an asset that pays no interest, less attractive compared with bonds and savings accounts.
The Fed Is Already Leaning Hawkish — Oil Gives It More Ammunition. The Fed delivered a quarter-point rate hike on September 17 and signaled that another could be coming before year-end . Investors currently price roughly a 66% chance of another 25-basis-point hike next month . The 10-year Treasury yield rose to 5.21% on September 28 , a level that makes risk-free government bonds a fierce competitor to non-yielding gold. Every tick higher in yields raises the "opportunity cost" — the return investors forgo by holding bullion instead of bonds.
Gold's Weekly Slide Accelerates a Bigger Pullback. Gold fell to $4,156.76 an ounce on September 28, down nearly 3% on the day . Over the past month, the metal's price has dropped 8.7% from its recent highs , dragging IAUM from its September 22 close of $43.49 to today's $41.40. Global oil inventories have plunged by 507 million barrels since February , meaning the supply crunch will not resolve quickly even if diplomacy eventually succeeds.
Diplomacy Remains the Swing Factor. Iran's foreign minister said no formal rejection has been conveyed through mediators and Tehran is "waiting for the definitive opinions" . Any renewed progress toward reopening Hormuz could reverse today's oil spike and relieve pressure on gold. But the Wall Street Journal reported Trump told aides he expects to resume bombing Iran after November's midterm elections — suggesting prolonged disruption, elevated oil, and continued headwinds for IAUM shareholders caught between geopolitics and the Fed's inflation fight.