Global Aluminium market shaken but resilient amid Middle East conflict in Commodity News 05/05/2026 The global aluminium market has been significantly disrupted—but not broken—by the ongoing conflict around the Strait of Hormuz, according to a new industry report. Supply chain shocks, damaged production facilities, and rising energy costs have pushed aluminium prices close to historic highs, with further volatility expected in the near term. The conflict has effectively blocked exports from the Middle East, which accounts for about 7% of global aluminium supply. Additionally, military strikes have damaged roughly 3% of global production capacity, with some smelters expected to take months or even years to fully recover. As a result, aluminium prices have surged to their second-highest levels ever, approaching peaks last seen during the 2022 Russia-Ukraine war. Analysts now expect prices to remain elevated throughout 2026, averaging around $3,400 per tonne. The disruption is expected to push the global aluminium market into a supply deficit in 2026 and possibly 2027. While some production may resume within months, key facilities—such as major smelters in the UAE and Iran—could take up to a year or longer to return to full capacity. At the same time, global inventories remain extremely tight, covering just a few days of demand, further supporting high prices. Aluminium production is highly energy-intensive, consuming around 4% of global electricity. Rising natural gas and coal prices—also linked to the conflict—are increasing production costs, which are being passed on to buyers. This dual pressure from both supply disruption and higher input costs creates additional upside risk for aluminium prices in the short term. Despite current challenges, the market is expected to stabilise over time. Analysts forecast a return to surplus conditions from 2028 onward as new projects—particularly in India and Indonesia—come online and disrupted capacity recovers. Demand is projec