NEW YORK: Palladium prices surged on Monday after the West slapping more sanctions on Russia over its invasion of Ukraine raised fears of supply disruptions and put safe-haven gold on pace to post its biggest monthly percentage gain in nine.

Palladium was up 6% at $2,508.19 by 12:44 p.m. ET (1744 GMT), having scaled a session high of $2,551.50. It was set to post its third consecutive monthly rise.

Russia’s Nornickel is the world’s largest supplier of palladium, used by automakers for catalytic converters.

“As sanctions increase on Russia and the tensions escalate, it creates a scarcity threat (for platinum metal groups),” said Eric Scoles, market strategist at Blue Line Futures.

The palladium supply deficit could certainly increase if the US is not doing business with the major producers, Scoles added.

Spot gold rose 0.4% to $1,894.56 per ounce, after gaining as much as 2.2% earlier in the session. US gold futures advanced 0.5% to $1,897.

Gold, often used a safe-store of value during times of political and financial uncertainty, has risen about 6.5% in February, having soared to an 18-month high of $1,973.96 last week.

“When geopolitical tensions get really high, gold still is the main safe haven asset outperforming the crypto currencies and other even other assets like Treasuries,” said Jim Wyckoff, senior analyst at Kitco Metals.

Financial markets slid and oil prices soared as Western allies ramped up efforts to punish Russia with new sanctions.

In response, Russia’s central bank on Monday moved to shield the economy as its invasion of Ukraine continued, bolstering other measures including an assurance it would resume buying gold in the domestic market.

Spot silver gained 0.4% at $24.29 and platinum fell 1.3% to $1,040.03. Both of them were poised to post monthly gains.