News - Diamond prices have significantly dropped due to instability in the Middle East.

The diamond industry is reeling as the Rapaport price index for 1-carat diamonds saw a decline of 1.7% in March 2026, attributed to escalating tensions in the Middle East. This downturn is part of a broader trend, with prices in this segment having decreased by 4.2% since the start of the year and 13.2% over the past twelve months. Furthermore, indices for other diamond weights also dropped: 0.3-carat diamonds fell by 1.1%, 0.5-carat by 3.5%, and 3-carat diamonds saw a decrease of 0.5%. The ongoing conflict in the Middle East has disrupted trading routes, leading to many diamond merchants in Dubai relocating their sales channels. This situation has also raised concerns about the access of Indian cutters to raw materials, essential for maintaining production. Despite the overall market contraction, larger diamonds, specifically those 5-carat and above, have retained their desirability due mainly to limited supply. In light of these market dynamics, De Beers has made strategic adjustments by excluding 20 to 25 siteholders from its list of 69 clients for the upcoming contract period starting July 1. This decision reflects an effort to enhance operational efficiency amidst a general reduction in both supply and demand. These shifts underscore the intricate dependencies and global influences affecting the diamond industry, revealing vulnerabilities that ripple through international markets in times of geopolitical instability.