Copper Prices Slip Amid High Energy Costs and Middle East Tensions

Copper prices are set to decline for the week, marking the biggest loss since May. The metal's value has been impacted by high energy costs and China's struggling industrial sector, which is curbing demand.

Futures on the London Metal Exchange rose above $14,300 per ton on Friday due to a dip in the dollar, but still finished about 2% lower for the week. Oil prices have increased due to ongoing tensions between the US and Iran, while data showing weakness in China's industrial sector has also weighed on copper.

Despite these challenges, copper prices remain relatively high due to supply tightness. The threat of US tariffs on refined metal has caused traders to redirect hundreds of thousands of tons to America, potentially leading to shortages elsewhere. A strike at a major mine in Chile is also adding to the market's uncertainty.

Analysts from Bank of America Corp. warn that the Middle East conflict may limit the upside for base metals, but note that falling supply should provide some support to prices.