Gold (XAU/USD) Bid Firms as Hormuz Bypass Talk Stirs Risk

Treasury Secretary Scott Bessent's remark that the Strait of Hormuz will become 'obsolete' within two years, thanks to new Gulf pipeline capacity, is being read by gold traders as a signal that energy-security risk is shifting rather than disappearing. XAU/USD tends to draw support whenever chokepoint infrastructure faces disruption or rapid rerouting, since either scenario keeps geopolitical premium embedded in pricing.

Pipeline buildouts of this scale rarely proceed without friction, and any delay or setback would likely reinforce gold's role as the default hedge against Gulf supply-route uncertainty. Until the bypass is operational and tested, dealers are unlikely to fully price out that risk, keeping a floor under bullion demand.

With the G20 backdrop adding policy noise, XAU/USD remains sensitive to headline risk around Gulf logistics, and any escalation could quickly reprice safe-haven flows higher.