Aluminium prices rose after Iranian attacks damaged Emirates Global Aluminium (EGA) and hit Aluminium Bahrain (Alba), which is still assessing operational disruption. Aluminium climbed as much as 6% to $3,492 per tonne in early trading on the London Metal Exchange.
The attacks add to earlier supply reductions across the Gulf. Curtailments at Alba and Qatalum have already affected about 560 kilotonnes of annual capacity.
As a result, around 8–9% of regional supply is now at risk. The Middle East accounts for roughly 9% of global aluminium production.
Any extended outages could tighten global availability further, given limited raw material inventories in the region. Shipping through the Strait of Hormuz is also a key route for maintaining supply flows.
The article says it was produced with the help of an Artificial Intelligence tool and reviewed by an editor.
We recall the significant supply shock in 2025 when attacks on Emirates Global Aluminium and Aluminium Bahrain sent LME prices surging past $3,400/t. That event highlighted the market’s vulnerability to geopolitical disruptions in the Middle East. It fundamentally changed how we price risk for the entire metals complex.
As of today, March 30, 2026, the market has not fully shaken off the impact of that disruption, with LME aluminium trading near $2,850/t. While regional production has shown some recovery, recent reports from the International Aluminium Institute show Gulf output still lags pre-2025 levels by an estimated 500,000 tonnes annually. Global inventories remain stubbornly low, sitting nearly 20% below the historical five-year average according to latest LME stock data.
Given this tight fundamental backdrop, we believe positioning for renewed upside volatility is prudent. Acquiring medium-term call options provides exposure to potential price spikes that could result from any new logistical or political friction in the Strait of Hormuz. The current risk premium seems insufficient to cover the possibility of another major outage.
A more conservative strategy involves using bull call spreads, which limits the upfront cost while still capturing significant upside. This is a practical way to position for a gradual price grind higher as the market continues to deal with the structural deficit created in 2025. This strategy performs well if prices re-test the $3,000/t level without another major supply shock.
Implied volatility in the aluminium options market is still elevated compared to the period before the 2025 attacks, indicating that traders continue to price in a high degree of uncertainty. This environment makes selling cash-secured puts on sharp price declines an attractive income-generating strategy. It allows traders to collect premium while setting a lower, more desirable entry point for a long position.
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