To update prices

July 10 (Reuters) - Gold prices fell on Friday and are on track for a weekly decline, as rising crude oil prices due to Middle East conflict and inflation fears reinforced expectations of tighter U.S. monetary policy.

Gold prices fell 0.4 percent to $ 4,103.23 an ounce by 6:10 p.m. GMT in spot trading, bringing their losses since the start of the week to 1.7 percent . U.S. gold futures for August delivery also declined, dropping 0.7 percent to $ 4,113.70 .

Bart Melek, global head of commodities analysis at TD Securities, said, "The key factor here is the renewed tension between the US and Iran, as investors generally do not want to hold gold and silver at the moment, which explains the move we have seen towards the 4100 level."

The International Energy Agency warned on Friday that the latest escalation in hostilities between Washington and Tehran could upset its forecast of a large surplus in the oil market next year.

Oil is on track for a weekly gain, boosted by supply concerns amid renewed US-Iranian strikes.

High energy prices are fueling concerns about inflation, which may prompt central banks to raise interest rates.

Gold is viewed as a safe-haven asset and a hedge against inflation, but rising interest rates often limit its appeal because it does not generate returns, while investors increasingly favor interest-bearing assets.

The CME Group’s FedWatch tool shows that traders expect a 69 percent probability of an interest rate hike in September.

Minutes from the Federal Reserve's (the US central bank) June meeting showed a split in opinions, but with a tendency to tighten monetary policy amid growing concerns about rising inflation.

Investors are currently awaiting US inflation data due next week, as well as a statement from Federal Reserve Chairman Kevin Warsh, for further clues about monetary policy direction.

Meanwhile, the price of gold fell sharply in India this week, while demand in China remained steady after the central bank announced in June the largest monthly increase in gold reserves in more than two and a half years.

As for other precious metals, silver fell 0.7 percent to $ 59.56 an ounce in spot trading, platinum rose 0.4 percent to $ 1,616.72 , and palladium gained 2.2 percent to $ 1,274.50 .