Azerbaijan sold gold worth $3 billion in first ever drawdown

Azerbaijan’s State Oil Fund sold about 22 tons of gold in the first quarter of the year, after a record-breaking rally pushed the sovereign wealth fund’s allocation of the metal to its maximum threshold.

The sales — worth more than $3 billion at current prices — mark the first time the fund has sold down its gold reserves since it started buying in 2012, according to its quarterly releases. In recent years, the fund known as Sofaz has been one of the biggest state-owned gold buyers, alongside central banks that have played a key role in driving gold prices to record highs.

While the fund didn’t disclose the reason for its sales, surging gold prices had helped to lift the value of Sofaz’s bullion to 38% of its $74 billion in total assets by the end of 2025. Gold can compose up to 35% of the portfolio, with a maximum upper deviation of 4%, according to the fund’s website.

Gold faced a major selloff towards the end of the first quarter as the war in Iran sparked turmoil across financial markets. A rallying dollar and surging oil prices have heaped pressure on emerging-market economies, prompting some to sell their gold holdings in a bid to protect their currencies.

Sofaz’s overall portfolio was mostly unchanged by the end of the first quarter, with weakness in equity and bonds offset by gains from gold holdings. Sofaz wasn’t immediately able to provide comment.

(By Jack Ryan)