Aluminum prices are nearing highs not seen since 2022 after recent attacks on Middle Eastern producers heightened fears of a supply crisis. On Monday, futures on the London Metal Exchange soared 5.5% to briefly hit $3,492 per tonne, a level last observed in April 2022, before settling at $3,381 per tonne, up 3.5% for the day.
The recent escalation began with Iranian drone and missile strikes on major producers, Emirates Global Aluminium (EGA) and Aluminium Bahrain. EGA reported “significant” damage to its Al Taweelah smelter, injuring staff members. CEO Abdulnasser Bin Kalban emphasized the safety of their people as a top priority while they assess the situation.
The attacks have created a tense atmosphere for commodity firms in the region. Around 9% of the world’s aluminum comes from the Gulf, but shipping has been disrupted since Iran restricted access through the Strait of Hormuz. In 2025, EGA’s damaged smelter produced 1.6 million tons of aluminum, making this attack’s impact particularly alarming.
Analysts predict that if these supply disruptions continue, prices may rise further. April Kaye Soriano, an aluminum research analyst at S&P Global Energy, mentioned that a prolonged supply issue could reshape the market. Joyce Li, a commodities strategist at Macquarie Group, added that they expected a production drop of approximately 20%, translating to a loss of about 800 to 900 kilotons of aluminum in 2026.
Aluminum is crucial for many sectors, including electronics and construction. China, the largest global producer, is a key player in this scenario. While it often keeps production limited to manage emissions, there are speculations that if prices rise too much, China might resume operations of idle smelters. Artem Volynets, CEO of ACG Metals, noted that a surge in China’s production could flood the market with aluminum.
However, S&P Global’s Soriano is cautious, stating that while China does have some capacity to increase output, the global market remains vulnerable to further disruptions, especially if conflicts extend beyond the region.
In summary, the recent attacks have not only impacted local producers but also threatened to reshape the global aluminum landscape. As tensions continue, industries that rely on aluminum must prepare for potential price increases and supply challenges.
For more insights, check out S&P Global’s recent reports here.
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