Palladium rose to a fresh 13-1/2-year high on Friday on worries over uncertain supplies from Russia, the world's largest producer of the metal, while gold prices eased on a dollar rise and gains in U.S. equities.
Tensions rose after Ukraine called for full membership in NATO, its strongest plea yet for Western military help after accusing Russia of sending in armoured columns that have driven back its forces in support of pro-Moscow rebels.
Supply of autocatalyst metal palladium from Russia is expected to fall 2 percent this year, GFMS analysts said, but the impact of potential sanctions over the Ukraine conflict is likely to be minimal. Russia accounted for more than 40 percent of supply last year.
Palladium prices were on track to rise over 2 percent this week, despite a 5 percent weekly drop in the holdings in palladium exchange-traded funds.
"Investors have stepped in on declines to bring prices right back up so far this year, and there is also a geopolitical element to the palladium market as well," said James Steel, chief metals analyst at HSBC.
Spot palladium was up 1 percent at $901.50 an ounce by 1:54 p.m. EDT (1754 GMT), while the NYMEX palladium contract for December delivery settled up $11.45 at $909.55 an ounce.
But big speculative long positions in U.S. palladium futures and the sizable ETF outflow earlier this week suggested the market could cut bullish bets, said Bart Melek, head of commodity strategy at TD Securities.
Meanwhile, spot gold fell 0.3 percent to $1,286.26 an ounce. U.S. COMEX gold futures for December delivery settled down $3 an ounce at $1,287.40.
For the month, gold has posted a 0.3 percent gain on lingering geopolitical tensions over Ukraine, Iraq and Gaza, recovering after briefly falling to a two-month low at $1,273.06 last week.
On Friday, the S&P 500 equities index edged up as the latest in a string of positive economic reports pushed investors to extend a rally that was briefly threatened by overseas concerns. [.N]
The gold market largely ignored a note of caution introduced by Britain, which raised its international terrorism threat level to the second highest, in response to possible attacks being planned in Syria and Iraq.
Among other precious metals, silver was down 0.8 percent at $19.39 an ounce, while spot platinum edged off 0.1 percent to $1,418.99 an ounce.