(Bloomberg) -- Gold held a retreat as the widening conflict in the Middle East pressured energy prices and increased expectations the US Federal Reserve will tighten monetary policy to contain inflation. The war is in a new phase of escalation after the effective collapse of a truce signed last month. Rising energy prices, alongside a seemingly resilient US labor market, increase the possibility that the Fed will raise interest rates. Fast money has "quickly turned sellers in gold" again as energy prices surged and inflation concerns re-emerged, TD Securities analysts including Ryan McKay said in a note. Gold has largely hovered around $4,000 since late June, which some traders see as a key support level.