Aluminum prices have surged to their highest level since 2022 as escalating conflict involving Iran disrupts supply chains and raises fears of a prolonged shortage in the global metals market.
Benchmark aluminum on the London Metal Exchange climbed to around $3,499 per metric ton, the highest level since April 2022, after gaining nearly 10 percent in the previous week amid intensifying geopolitical tensions in the Middle East.
Market analysts say the rally has been driven by concerns over disruptions to production and shipping routes in the Persian Gulf region, which accounts for roughly 9 percent of global aluminum supply. With tensions escalating, buyers are rushing to secure alternative supplies from Asia and other regions.
The conflict has already affected operations at several major smelters in the region. Some producers have declared force majeure and halted deliveries due to logistical and energy supply disruptions, adding further pressure to an already tight market.
Traders warn that the situation could worsen if the conflict continues to affect shipping routes and energy infrastructure in the Gulf. The region’s strategic shipping corridors are vital for transporting both raw materials and finished aluminum products to global markets.
The surge in aluminum prices is part of a broader wave of volatility across commodity markets triggered by the conflict. Oil and other energy-linked commodities have also jumped sharply, raising concerns about inflation and rising industrial production costs worldwide.
Industry analysts note that aluminum demand remains strong due to its widespread use in construction, transportation, packaging and renewable energy technologies. With inventories already low before the conflict, any prolonged supply disruption could push prices even higher in the coming weeks.