Market Panic: The Wild Hunt for 100-Ounce Gold Bars

But the virus, and the global economic collapse that it's sparking, have created such extreme price distortions that those easy-exit options disappeared on them. Which means that they suddenly faced the threat of having to deliver actual gold bars to the buyers of the contract upon maturity.

...

Signs of distress picked up on Friday, March 20, when the cost to swap New York futures and spot physical gold in London -- the world's biggest market -- rose to about $2. Typically, this trade cost almost nothing. After the close of the next session on Monday, that premium had jumped further to $6.75.

...

The spread between April and June futures contracts on Tuesday jumped to $20 an ounce, meaning it cost that much more to buy metal for April than it did for two months later. That signaled more near-term demand for bullion and the need to soon have physical supply in hand.

By the end of the week, though, the situation had flipped. The June contract cost almost $30 more than the April contract, suggesting that traders appetite for physical gold has subsided for now.