Copper Prices Edge Up, Notching First Weekly Increase Since Outbreak of Tensions Over Iran Conflict

Copper Prices Rise on Diplomatic Efforts to End Middle East Conflict

Copper prices rose 0.7% to $12,227.50 per ton on the London Metal Exchange on Friday, driven by optimism that diplomatic efforts to end the war in the Middle East may prevent a slowdown in global growth. This marked a 2.5% weekly gain, the first of the month.

The Middle East conflict has had a significant impact on industrial metals, with most experiencing a decline in price this month due to expectations of inflation and slowed global growth. However, aluminum has been an exception, with the effective closure of the Strait of Hormuz cutting off about 9% of global supply. This has driven up prices, with Japanese buyers agreeing to pay the highest premium in 11 years.

In addition, investors are monitoring the recovery in Chinese copper demand, which has seen a boost in orders from fabricators and a significant drop in inventories at the start of the week. Iron ore prices, however, dropped 0.6% to $105.75 per ton in Singapore, poised for its first weekly decline in five weeks.

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The US is considering sending up to 10,000 additional troops to the Middle East, but the extent of diplomatic efforts to end the conflict remains unclear. Aluminum prices are headed for a 1.7% weekly increase, while copper prices are poised for their first weekly gain this month.