Aluminum Skyrockets on War Shock
Aluminum prices soar amid Middle Eastern conflict
WAR: Aluminum prices rocket to four-year highs with the war in the Middle East.
This week has brought fresh headaches for contractors and manufacturers across the HVAC and sheet metal sectors, as the world’s most critical industrial metals – aluminum, copper, and steel – move in sharply different directions. The volatility is being driven by a potent mix of geopolitical conflict, economic unease, and ongoing regulatory and supply chain challenges.
Aluminum, long prized in the industry for its light weight and recyclability, is now at the epicenter of a historic price spike. The ongoing US-Israel and Iran war has cut off deliveries from major Middle Eastern producers, driving unprecedented tightness in global supply. On Wednesday, official London Metal Exchange (LME) three-month aluminum prices soared to $3,372 per ton, topping the previous 2026 peak and setting a new four-year high. Shipments through the Strait of Hormuz – more than 5 million tons last year – have been severely disrupted, as detailed in an analysis by Argus Media. More than just numbers on a screen, this represents a major supply artery for the global market: aluminum shipped through the Strait last year was bound for 70 countries across Asia, Europe, and North America, while bauxite and alumina flowed in the opposite direction. Read the full Argus Media report.
Production and delivery stoppages have already been announced by regional producers Qatalum and Alba. Saudi Arabia's Maaden and the UAE's Emirates Global Aluminium (EGA) are scrambling to reroute product by truck to alternative ports – an expensive and temporary fix that doesn’t solve the bigger problem of disrupted raw material deliveries. EGA has told customers it will leverage stocks held outside the UAE for now, but the longer-term picture remains fraught.
Financial analysts are sounding the alarm. Goldman Sachs estimates that just one month of full production loss from the Middle East would push aluminum temporarily to $3,600 per ton, with Citi now predicting a three-month average of $3,600 per ton and warning that prices could surge to $4,000 per ton in a bull-case scenario. As Citi put it, force majeure has now materialized at two Gulf producers, marking a clear shift from risk to realized disruption. Force majeure means an unforeseen event, like war or disaster, that prevents companies from fulfilling contracts.
Europe is feeling the sting most acutely, with premium prices jumping to $410–$440 per ton. In the U.S. Midwest, premiums have set a new record at $1.06–$1.08 per pound. Argus Media notes that as long as supply from the Middle East remains offline, premiums are expected to climb even higher.
For HVAC and sheet metal contractors, these increases are immediate and painful. Suppliers such as Petersen Aluminum have already issued price hike notices, citing rising raw material costs and warning of further adjustments if input prices remain elevated. See Petersen Aluminum’s announcement. Even as recycling remains a bright spot – 75% of all aluminum ever produced is still in use, as highlighted in the Aluminum Association's latest bulletin – new supply is increasingly expensive and unpredictable. Explore the Aluminum Association’s bulletin here.
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