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Aluminium and nickel prices were trading higher on Wednesday on market speculation that a new round of US sanctions against Russia could target certain metals and disrupt supply.
At 9:50 a.m. London time, the price of an aluminium futures contract on the London Metal Exchange (LME) rose 2.6 percent to $2,251.50 a tonne, while nickel prices rose 1.8 percent and copper prices gained 0.4 percent.
US President Joe Biden said earlier that the US planned to announce a “significant” sanctions programme against Moscow, but did not specify which industries would be affected. And traders have been eyeing new restrictions on Russian metals since the UK announced last December that it would ban British individuals and entities from trading in physical metals such as Russian aluminium, copper and nickel.
According to White House spokesman John Kirby, the proposed restrictions are aimed at “holding Russia accountable” for the death of opposition leader Alexey Navalny.
After the news, London aluminium prices rose as much as 3.4% during Wednesday’s session, then narrowed a bit, while nickel prices climbed more than 3.5%.
Li Jiahui, an analyst at Shanghai Metals Market, said, “Biden’s statement pushed metal prices up, and investors are evaluating potential measures and impacts and waiting for specific measures to land.”
Biden said sanctions would be announced as a response to Navalny’s death. US White House national security adviser Jake Sullivan said the latest sanctions against Russia would target a range of items, including defence, industry and sources of economic revenue.
Aluminium prices rose to record levels of more than $4,000 a tonne at one point after the Russian-Ukrainian conflict erupted in February 2022, when large parts of the Russian economy and many prominent officials were subject to sanctions by countries led by the United States.
An unnamed senior U.S. official said a sanctions programme for the second anniversary of the outbreak of the Russian-Ukrainian conflict was already in the pipeline and that Washington would now reconsider and supplement it.
