The international gold price surged in the early stages of the Iran war outbreak, but then fell sharply until the ceasefire agreement between the US and Iran, when the price stopped falling and began to rise again. James Luke, senior investment portfolio manager for Schroders Global (Gold and commodities), believes that gold has always been considered a good investment diversification tool, effectively hedging long-term risks from geopolitical and financial pressures. However, extreme oil price increases are likely to impact all asset classes in the short term, including gold. Nevertheless, this period may be seen as a good buying opportunity. Schroders Global is optimistic about the gold price for two main reasons. Firstly, the shift from American unipolarity (which peaked in the early 2000s) to multipolarity in major power competition in geopolitics could continue if the confidence in global institutions and supply chains weakens, unless the US/Israel quickly achieve overwhelming victory. Secondly, the current events could exacerbate stagflation and defense spending burdens. The probability of an economic recession is increasing, with G7 members' fiscal positions deteriorating and their debt and deficits continuing to rise. War could be seen as the next fiscal shock, while the possibility of deteriorating fiscal prospects in various countries is quite high. James Luke points out that even as the Middle East crisis continues, once the reflexive selling of gold due to short-term conditions is over, gold will begin to reverse its recent negative correlation with the oil market. As for gold stocks, their value has fallen by about 25% since the outbreak of the conflict. James Luke says investors are worried about cost inflation and falling gold prices, which could seriously erode the profit margins of gold mining companies. The market is once again showing a reflexive trend, viewing this Iran crisis as a repeat of the 2022 Ukraine energy crisis, which ultimately led to underperformance of gold stocks compared to gold bars. However, the biggest difference between now and 2022 lies in the starting point of profit margins for gold mining companies. Calculated on an all-in basis (including total sustaining costs and cash taxes), the profit margin at the outbreak of this conflict is about ten times higher than at the start of the Ukraine war, around $150 per ounce in early 2022 and $1800 by the first quarter of 2026. Therefore, even with costs rising much faster than gold prices, the profit margins of gold mining companies are likely to expand, making gold stocks still very attractive.