Copper Surges Past $14,000 Amid Inventories Squeeze

Copper prices surged to a two-month high on Tuesday, hitting above $14,000 per metric ton. The increase was driven by dwindling inventories and hopes for a resolution of the Iran war.

The London Metal Exchange (LME) reported that benchmark three-month copper rose 1.4% to $14,065 per metric ton in official open outcry activity. It hit a session high of $14,115, the most since June 2.

The dwindling inventories were highlighted by orders to withdraw another 7,225 tons of copper from LME warehouses, leaving available inventory at just 94,200 tons, little more than a day's worth of global consumption. This led to a premium in the cash-to-three-month spread reaching as high as $105 per ton, the steepest since January.

Others metals also rose, with aluminium adding 0.5% to $3,236 a ton and touching its highest since June 23. However, analysts at Sucden Financial noted that 'aluminium has reclaimed the $3,200/t area, but we do not expect prices to hold comfortably at these levels without a renewed Middle East shock or another clear supply-risk catalyst.'

Meanwhile, conflicting signals from the United States and Iran over talks to end their five-month-old war continued to create uncertainty.