Aluminum futures in the UK extended their advance, approaching $3,470 per tonne and on track for a monthly gain of about 10%—the strongest performance in nearly two years. The rally has been fueled by mounting concerns over a prolonged supply squeeze following Iranian strikes that damaged two Gulf-region smelters operated by Aluminium Bahrain and Emirates Global Aluminium. Both producers have yet to issue updates on the status of their operations.
The escalation of hostilities in the Middle East has had an outsized effect on aluminum, as the region is a key source of primary metal, with nearly all local production destined for export. Those shipments are now constrained by the closure of the Strait of Hormuz. Signs of tightening in the physical market are also evident, with LME warehouse stocks dropping to 418,675 tonnes as of March 27, the lowest level since July 2025. Adding further support to prices, China’s factory activity returned to expansion in March, pointing to strengthening demand for industrial metals.
