Spot gold prices fell almost 1 per cent to $1,623.70 per ounce at 16.20 UAE time (12.20 GMT) this evening even as traders remain concerned over fresh debt tensions in the Eurozone and lackluster trading a day before the Indian gold buying festival Akshaya Tritiya. According to Dubai Gold and Jewellery Group’s morning rates, gold is currently at a two-week low. While 24ct gold is being retailed at Dh196.50 per gm, 22ct gold is going for Dh184.75/gm and 18ct gold is available at Dh150.75 per gm in Dubai, the city of gold. However, according to some analysts, this may be the only window available for medium-term investors to buy gold at these prices as China, arguably the world’s only working-condition growth engine, is reportedly mulling paying for Iranian oil in gold to avoid US-led sanctions on Iran trade, which kick in on June 28, 2012. According to reports, Iran has already offered China and India – its leading oil purchasers – oil in exchange for goods other than their local currencies like wheat, soy and other consumables including white goods. Logically, however, Iran won’t be able to meet all its foreign goods need through such a barter mechanism, besides the fact that it will need to save a share of the proceeds for future use. That brings gold, the ultimate store of capital, into the picture. According to official gold holdings data from the World gold Council, China has the sixth largest gold reserves in the world (after the US, Germany, IMF, Italy and France), and currently holds about 1,054.1 tonnes of the yellow metal in its vaults. China purchased 454 tonnes of gold over a six-year period between 2003 and 2009 (besides adding about 100 tonnes in December 2002), and come July 2012, it will perhaps make the most use of its ballooning gold reserves. India, on the other hand, holds 557.7 tonnes of gold reserves, having bought 200 tonnes of gold from the International Monetary Fund (IMF) in October 2009. And these are just two (admittedly largest) of Iran’s oil importers. If more countries decide to join the gold-for-oil bandwagon to avoid choosing between plying their cars on the road and a head-on collision with the US, it’s anybody’s guess to where the precious metal prices may end up in the second half of 2012. However, there’s many a slip between the cup and the lip. There are a host of factors that could easily derail this joyride – not least among them is the US adding additional clauses to its sanctions, barring countries from an gold-for-oil barter. Then again, it will also be up to Iran to determine if it needs that much of gold – why not silver, or platinum, in that case? – or if it is happy to receive refrigerators and washing machines instead.