Middle East Conflict Causes Supply Shock in Aluminum Markets
The ongoing conflict in the Middle East has resulted in significant disruptions to global trade flows, particularly affecting energy and commodity markets. According to the International Energy Agency, the International Monetary Fund, and the World Bank, the crisis has led to immediate supply shortages in the aluminum market. The Strait of Hormuz has become a critical chokepoint, with missile and drone strikes shutting down operations at major producers like Emirates Global Aluminum and Aluminium Bahrain. This has knocked offline roughly 3 million tons of annual capacity, nearly half of the Middle Eastern output. The closure of the Strait is also affecting the flow of alumina, a key input for aluminum smelting, with 60% of the region's supply passing through the strait. As a result, aluminum prices have surged to around $3,500 per ton, near four-year highs. 
