On Monday, the metal went up to $2,377.50 per ton, setting a new seven-year record. Over the past week, its value increased by 12 percent.
In early April, Washington extended anti-Russian sanctions. The updated blacklist includes major Russian aluminum producer RUSAL. On Monday, the company’s shares touched an all-time low, and analysts worried that it would be forced to cut production.
“We have a potential scenario where US and European markets will be shut off to RUSAL, and they’ll be forced to redirect units to clients in other markets,” Nicholas Snowdon, a metals analyst at Deutsche Bank AG, told Bloomberg.
“Doing the maths, that’s going to pose significant challenges, and there’s clear potential that they’ll have to cut production,” he said.
Russia’s aluminum association told RT that sanctions against RUSAL are likely to hurt many Western countries as well. “The high price of aluminum, which is the result of the largest player’s withdrawal from the market, will slow economic growth and affect the competitiveness of export-oriented European industries like automotive industry and other transport engineering. Germany can suffer the most,” the association said in a comment.
“The Russian metal is in demand all over the world, therefore the consequences of sanctions for the economies of other countries have yet to be assessed. But certainly, American sanctions will hit many countries, first of all, it will hit the competitiveness and generally profitability of such industries as automotive and machine building,” it added