Spot gold continued its decline during the Asian and European trading session on Thursday, at one point falling more than 2%. It is currently trading around $4,386, down 1.57%.

The U.S.-Iran conflict has intensified recently amid a mix of military strikes and negotiation tactics. In the early hours of May 28 local time, explosions were reported in the port of Abbas in southern Iran, prompting the activation of air defense systems. Iran's Islamic Revolutionary Guard Corps confirmed a U.S. airstrike and subsequently launched retaliatory strikes against U.S. air bases, vowing a "more decisive" response to any further U.S. attacks.

This marks the second "defensive strike" by U.S. forces against Iran this week. On the 25th, U.S. forces targeted Iranian mine-laying vessels and air defense missile sites near the Strait of Hormuz. Iran, in the past four days, has shot down a large U.S. drone and an Israeli reconnaissance drone, with military tensions around the strait continuing to escalate.

Core Demands Clash, Frozen Assets Emerge as Key Sticking Point Behind the military clashes, U.S.-Iran negotiations, while progressing at a framework level, are mired in several core disagreements.

The Trump administration's core demands are clear: Iran must surrender all 440.9 kilograms of its 60% enriched uranium (a step away from weapons-grade) and cannot accept Russia or China as third-party custodians. Additionally, it demands that countries like Kuwait and Saudi Arabia join the "Abraham Accords" to normalize relations with Israel, with Trump stating he is "unsure about reaching a deal" otherwise.

Iran, however, maintains a firm stance, not only upholding its "red lines" on uranium enrichment capabilities and control of the strait but also setting a precondition: the U.S. must unfreeze $24 billion in frozen assets, with $12 billion disbursed immediately upon announcement of an agreement and the remainder within 60 days. These funds originate from Iran's sanctioned oil and gas revenues, frozen in countries including South Korea, Qatar, Iraq, and Germany. The Trump camp firmly opposes this "concessionary" clause, making it a central obstacle in the negotiations.

Internal Divisions and Geopolitical Maneuvering Create Further Hurdles Furthermore, the agreement's terms have sparked internal divisions in the U.S. Republican allies like Lindsey Graham and Ted Cruz have criticized the deal for being too similar to the Obama-era Iran nuclear deal and overly favorable to Iran.

Geopolitical maneuvering involving Israel and Lebanon also complicates the agreement. Iran insists any ceasefire must cover Lebanon, while the U.S. seeks flexibility, explicitly affirming Israel's right to self-defense. Clashes between the Israeli military and Iran-backed Hezbollah continue in southern Lebanon.

Trump's push to expand the "Abraham Accords" has also met resistance. Saudi Arabia and other nations condition their participation on a "guaranteed path to Palestinian statehood," a demand rejected by Israel. Gulf state officials have responded to Trump's proposal with an awkward silence.

Strait of Hormuz Navigation Faces Multiple Hurdles, Full Recovery Will Take Time Currently, the strait is not completely closed, but nearly three months of disruption have left approximately 1,500 vessels stranded. Even if a U.S.-Iran ceasefire is reached, restoring normal navigation faces multiple practical obstacles.

Iran has established the "Persian Gulf Strait Authority," declaring that all transit vessels require its authorization. It has implemented a tiered passage system, prioritizing ships from allied and closely related nations. Vessels not covered by intergovernmental agreements must pay fees exceeding $150,000 and undergo strict inspection by the Revolutionary Guard.

Sea mines previously laid by Iran have caused significant damage. The International Energy Agency notes that mine-clearing operations could take weeks. Furthermore, long-stranded vessels, with hulls fouled by marine organisms, require extensive cleaning and sail at speeds well below normal levels.

Global shipping organizations estimate that even with an orderly passage procedure established, strait traffic would only recover to 40%-50% of normal levels within three to four weeks, with a full recovery potentially taking months.

More notably, the struggle for control of the strait continues. Iran insists on its management authority, while U.S. forces have repeatedly taken military action under the pretext of "counter-mining." On the 28th, the Iranian navy fired warning shots to drive away an unauthorized vessel, indicating ongoing risks to navigation safety.

Expert Analysis: Trump Faces Dual Pressures from Elections and Geopolitical Game Doug Bandow, a senior fellow at the Cato Institute, points out that the U.S.-Iran contest has shifted from the military front to the economic front. Trump's decision to close the Strait of Hormuz "inadvertently handed Iran a very powerful weapon," yet he is unwilling to risk forcing it open, leaving him in a dilemma where "it is difficult not to reach an agreement that satisfies Iran."

Bandow also questions Trump's claim of not caring about the midterm elections, suggesting the Republican Party's prospects in the November elections are a core concern. Persistently high energy costs and fuel prices are affecting voter sentiment, creating an urgent need for Trump to end the conflict quickly.

Jonathan Conricus, a senior fellow at a hawkish Washington think tank, worries that if sanctions are lifted, Iran will rapidly rebuild its military capabilities and increase support for proxy forces like Hezbollah and Hamas, stating, "The fighting is far from over; Iran's strategic ambitions have never subsided."

Shipping and energy experts widely warn that even if the strait reopens, restoring oil field production and repairing facilities will require a lengthy period, and a swift recovery of the global crude supply chain is unlikely.

Summary and Technical Analysis: The current situation appears complex but is relatively favorable for the U.S. Iran's dispatch of its central bank governor and repeated mentions of unfreezing sanctioned funds indicate significant fiscal strain following restrictions on its tankers.

Simultaneously, the U.S. made the first move in recent probes, to which Iran responded with relative restraint, giving the U.S. a surface advantage.

Regarding physical constraints, the U.S. blockade of Iranian tankers has not been classified as a military action, allowing U.S. forces to be deployed without requiring congressional approval for operations exceeding 60 days. However, Iran's internal pressures, such as oil field production cuts and filling storage capacity, remain unresolved.

While the U.S., under midterm election pressure, desires an earlier end to the conflict, signing a highly unfavorable agreement could still lead to political repercussions even if the war ends. The U.S. may therefore seek a more substantial outcome, using the results to mitigate the negative impact of inflation on the midterms.

Trump has even claimed that sanctions would not be lifted even if Iran abandoned uranium-related activities, similar to recent tactics of gaining an advantage and then raising demands, which supports the above viewpoint.

Technical Perspective: Spot gold has touched the lower boundary of its descending channel. Combined with potential downside pressure from tonight's PCE data, this could present a temporary buying opportunity for a rebound. Support is at the channel's lower boundary, with resistance at the 5-day moving average and the channel's midline.

As of 16:21 Beijing Time, spot gold is trading at $4,393 per ounce.