Copper prices rise as US-Iran lull calms oil and economic growth fears

LONDON: Copper prices rose on Monday as oil prices fell after the U.S. and Iran suspended hostilities, easing concerns about price pressures and global economic growth.

Benchmark copper on the London Metal Exchange was up 0.32% at $13,688.5 a metric ton at 0700 GMT. After 13 nights of intensifying U.S. airstrikes on Iran, the Pentagon suspended the campaign on Friday.

Iran, which had been following each night of U.S. attacks with its own strikes on neighbouring countries that host U.S. bases, has held fire for two days.

Oil prices tumbled as the pause in fighting raised hopes of a diplomatic solution that would allow shipping to resume in the Strait of Hormuz.

“The market is now waiting for some sort of resolution and it is trying to price in peace rather than an ongoing war,” said Panmure Liberum analyst Tom Price.

“Chile has been hit by unusual storms, putting pressure on the power distribution grid and raising questions about copper production guidance across the industry.”

Chile accounted for 23%, or 5.3 million tons, of mined copper production globally last year, according to U.S. Geological Survey.

Traders said the market was also focused on copper stocks in LME-approved warehouses. At 272,975 tons, stocks have dropped 30% since the end of May.

Producers and traders have been shipping copper to the United States since February last year, when President Donald Trump threatened import tariffs, creating a premium for U.S. copper over LME prices.

The U.S. Commerce Department was due to complete a review of the copper market by June 30, but Trump has not yet announced a decision on tariffs.

In other metals, aluminium gained 0.6% to $17,385 a ton, zinc rose 0.8% to $3,621, lead was up 0.3% at $1,839 and tin climbed 1.3% to $54,500 while nickel was little changed at $17,385.