Barrick Gold's Uncertain Near-Term Catalysts Amid Global Trade Tensions

The U.S.-China trade truce announced in June 2025 has injected a dose of calm into global markets, but for Barrick Gold, the world's largest gold producer, the path forward remains fraught with uncertainty. While easing trade tensions have temporarily dented gold prices, the metal's long-term appeal as a safe haven and store of value persists, driven by record global debt, central bank purchases, and geopolitical risks. Meanwhile, Barrick's operational challenges in key mining jurisdictions—Peru, Chile, and Tanzania—are testing its ability to capitalize on these trends. The company's stock, which has lagged behind gold's price gains in recent years, now faces a critical juncture: can it navigate its operational hurdles to unlock value, or will persistent risks keep investors on the sidelines?

The Gold Dilemma: Trade Truces and Safe-Haven Demand

The June 2 trade truce between the U.S. and China marked a significant de-escalation in their decade-long tariff war. Tariffs on most goods were slashed, and a 90-day “pause” on new hostilities was agreed upon. This relief, however, came with caveats: lingering accusations of breaches, U.S. restrictions on ethane exports, and China's continued control over rare earth minerals. The immediate market reaction was a sharp decline in gold prices, with the June futures contract dropping 2.6% to $3,241.80—marking a 50% correction from its April peak.

The drop was fueled by a stronger U.S. dollar, which surged 1.37% to 111.63, and profit-taking by investors. Yet, structural tailwinds for gold remain robust. Global debt now exceeds $324 trillion, with the U.S. facing a credit rating downgrade from Moody's. Central banks, particularly in emerging markets, are accumulating gold at a breakneck pace: net purchases hit 244 tons in Q1 2025, 24% above the five-year average. Meanwhile, gold ETF inflows, though moderating, continue to reflect investor anxiety over fiscal instability.

Barrick, as a leveraged play on gold prices, benefits when these tailwinds strengthen. But its stock's performance has been hamstrung by operational risks, not just macroeconomic factors.

Operational Challenges: Mines as Microcosms of Global Risks

Barrick's struggles in its core mining jurisdictions underscore the fragility of its operational model.

Peru: A Slow Exit from Lagunas Norte

Barrick has long sought to divest its Lagunas Norte mine, which is nearing the end of its productive life. However, high closure costs and buyer hesitancy have stalled the sale. The company now considers placing the mine on care and maintenance—a costly delay. Meanwhile, regulatory and social pressures persist in Peru, where new mining-friendly policies have yet to translate into smoother operations.

Chile: Environmental and Cost Headwinds

In Chile, Barrick's Veladero mine (a joint venture with Shandong Gold) is grappling with high operational costs—projected at $1,300 per ounce, far above the $700–$900 range of its top-tier assets like Pueblo Viejo. Meanwhile, the Pascua-Lama project, a transboundary venture with Canada's Goldcorp, was ordered closed permanently on the Chilean side due to environmental violations. Shandong Gold's evaluation of the Argentine side offers some hope, but delays and regulatory hurdles loom large.

Tanzania: Exploration in an Unstable Environment

While Barrick's Tanzanian operations are less troubled than those in Latin America, they still face geopolitical and regulatory uncertainty. The government's push for higher mineral royalties and its unpredictable fiscal policies—mirroring issues in Mali—create a volatile backdrop for exploration.

The Broader Regional Picture

Argentina's economic turmoil, including currency devaluation and tax impairments, has already dented asset valuations. In Africa, Barrick's focus on the Greenstone belts in Tanzania is hampered by the same fiscal unpredictability seen in Mali, where the company's operations were disrupted by political instability.

Strategic Responses: A Balancing Act

Barrick is attempting to offset these risks through asset optimization and cost discipline. It sold its stake in the Donlin gold project for $1 billion, redirecting capital to high-margin assets like Reko Diq (Pakistan) and Fourmile (Nevada). The company also continues to invest in exploration, leveraging advanced technologies to identify new deposits.

However, these moves are not without risks. High-cost projects like Veladero and Pascua-Lama continue to strain cash flows, while the delay in divesting Lagunas Norte underscores the challenges of exiting non-core assets in a weak mining market.

Data-Driven Insights

Barrick's stock has underperformed gold prices in 2025, reflecting investors' concerns over operational execution. While gold's base-case price range of $3,100–$3,500/oz in 2025 supports its valuation, Barrick's ability to deliver production growth and cost savings will be critical to closing this gap.

Investment Implications: A Cautionary Hold

Barrick's story is a classic case of “high reward, high risk.” On one hand, the long-term demand for gold—driven by de-dollarization, central bank purchases, and debt-driven inflation—is undeniable. Barrick's scale and reserves position it to benefit from a sustained price rally.

On the other hand, its operational challenges and geopolitical exposures introduce near-term volatility. The company's stock price is likely to remain range-bound unless it can resolve its asset-sale logjams, reduce costs at legacy mines, and avoid further regulatory setbacks.

For investors, Barrick's shares are best held as a long-term play on gold's structural bull market, but with a cautious outlook for the next 6–12 months. Those seeking short-term gains might prefer gold ETFs or miners with less operational complexity, such as Newmont or AngloGold Ashanti.

Conclusion

Barrick Gold sits at the intersection of two powerful forces: the enduring appeal of gold as a safe haven and the operational minefields of its global mining empire. While the trade truce has dimmed gold's near-term glow, the structural case for the metal remains strong. For Barrick to thrive, it must navigate its way out of costly legacy projects and regulatory quagmires—a task that requires both patience and execution. Until then, investors should tread carefully, but not dismiss the company's long-term potential.

This analysis is for informational purposes only and should not be construed as investment advice.