American Tungsten Corp. (TSXV: TUNG, OTCQB: DEMRF)
Building America’s Defense Critical Metals Supply
Fertilizers, industrial metals and chemicals feel the strain as Strait of Hormuz disruptions reshape global supply chains
The Middle East conflict, now in its second week since US and Israeli strikes against Iran, is sending shockwaves through global commodity markets far beyond the initial oil price surge.
While Brent crude briefly hit $120 per barrel before retreating to $90 following strategic reserve releases, analysts warn that broader commodity markets are undergoing a fundamental transformation as shipping through the Strait of Hormuz grinds to a halt and regional production faces mounting disruptions.
“The market is underestimating the scale of the supply risk,” said Randy Ollenberger of BMO Capital Markets, calling the conflict the biggest shock to oil markets in decades. Traffic through the Strait of Hormuz has dwindled from 80 tankers daily to just a handful, with storage bottlenecks and refinery outages compounding pressures. Ollenberger noted that upside risks to prices will persist as long as the threat of regional disruptions remains.
Fertilizer markets are feeling immediate heat, with nitrogen prices climbing approximately 30% since the conflict began, according to BMO’s Joel Jackson. Middle Eastern countries account for nearly half of global urea exports, and when combined with Russian supply, the concentration in global nitrogen markets becomes stark. Rising European gas prices and disrupted Middle East output are widening cost advantages for North American producers such as CF Industries and Nutrien.
The chemicals sector is experiencing similar strains. John McNulty of BMO noted that the Middle East represents roughly 15% of global polyethylene production. With supplies constrained, industry utilization rates could quickly approach full capacity, marking a sharp reversal from the oversupply conditions that prevailed months ago.
In metals, aluminum has emerged as a price leader. Helen Amos of BMO attributes this to supply risks: approximately 9% of global aluminum production originates in the Middle East, with as much as 5 million tonnes of regional capacity potentially facing disruption. Iron ore has gained support from the region’s pellet supply role, while thermal coal has risen alongside natural gas prices.
The outlook for battery metals is more complex. BMO’s George Heppel noted that while lithium faces limited immediate exposure to rising sulfur costs, prolonged disruptions could affect refining in China. Nickel carries greater risk because extraction is highly sulfur-intensive, particularly in Indonesia.
Beyond traditional metals, the conflict may boost demand for minerals used in defense applications, including tungsten, rare earth elements and antimony.
During a 2025 interview with “METALS 100”, Ali Haji, Chief Executive Officer of American Tungsten Ltd. (CSE: TUNG | OTCQB: DEMRF | FSE: RK9), elaborated on the company’s recent updates and next steps. American Tungsten is a Canadian exploration company focused on high-potential tungsten and magnetite assets in North America. The company is advancing the Ima Mine Project in Idaho toward commercial production to address critical metal scarcity in North America. It has joined the U.S. Defense Industrial Base Consortium to support the defense sector and completed an oversubscribed C$7 million financing, demonstrating strong market confidence in its critical metals strategy.
With the conflict’s duration uncertain, analysts expect commodity markets to remain highly sensitive to regional developments. Fertilizer shortages could push food prices higher, while aluminum supply constraints risk increasing costs for vehicles and construction materials. For investors, the focus has shifted from a simple “oil premium” toward broader commodity supply chain restructuring.
