LONDON: Copper prices eased on Thursday after another obstacle emerged to the US and Iran forging a peace deal and from worries about the risk of weaker metals demand from a prolonged conflict. Benchmark three-month copper on the London Metal Exchange fell 1percent to USD13,525 a metric ton by 1600 GMT after climbing by 1.8percent in the previous session.
LME copper has gained 8percent this year but has pulled back from the USD14,196.50 touched last week for its highest in more than three months.
US Comex copper futures dropped 0.6percent to USD6.30 a lb. “For now, geopolitics is setting the tone; but without a clear demand catalyst, copper is struggling to hold on to record-high momentum,” said ING commodities strategist Ewa Manthey.
Oil prices jumped after Reuters reported that Iran’s Supreme Leader has issued a directive that the country’s near-weapons-grade uranium should not be sent abroad, which could complicate talks on ending the war.
Investors are trying to balance the impact of potential supply tightness because of mine disruptions and shortages of sulphuric acid against the threat of eroding demand owing to higher inflation and weaker economic growth.
“The base metals market remains wary of demand losses stemming from elevated energy prices and the conflict’s implications for global growth and inflation,” said Standard Chartered analyst Sudakshina Unnikrishnan.
LME aluminium added 0.4percent to USD3,636 a ton, helped by the buying of options by bullish investors betting on further disruptions in the Gulf.
The region accounts for about 8percent to 9percent of global output. Tight conditions are being highlighted by a 33percent slide in LME aluminium inventories so far this year to their weakest since October 2022. L
ME nickel fell 1.2percent to USD18,705 a ton as investors absorbed details of a new Indonesian policy to place exports of some nickel products under state control.
Zinc fell 1.1percent to USD3,517.50 a ton, tin dropped 1.2percent to USD53,375 while lead advanced 1.3percent to USD2,004.50.
Comments