Copper Drops on US Hormuz Blockade

Copper futures fell more than 1% to below $5.8 per pound on Monday, trimming last week’s gains after President Donald Trump announced plans to blockade the Strait of Hormuz following the failure of US-Iran negotiations over the weekend, adding fresh uncertainty to metals markets. Talks in Pakistan ended without a deal as the US accused Iran of refusing to abandon its nuclear ambitions, while Tehran reportedly demanded control of the Strait of Hormuz, war reparations, a regional ceasefire, and access to frozen overseas assets. The prolonged Middle East conflict, which has driven energy prices sharply higher, weighed on the outlook for global growth and industrial activity. Copper was also pressured by rising inventories, with stockpiles in LME warehouses climbing to an eight-year high, signaling weaker demand conditions.

Copper increased to 5.81 USD/Lbs, the highest since March 2026. Over the past 4 weeks, Copper lost 0.67%, and in the last 12 months, it increased 28%.

Copper futures steadied around $5.75 per pound on Friday and were on track for a third consecutive weekly advance, supported by optimism that the US-Iran ceasefire will hold and eventually lead to a reopening of the Strait of Hormuz. The potential reopening of the vital waterway is expected to ease investor concerns over inflation and slowing global industrial activity, which have clouded metals demand. Investors are now focused on diplomatic talks in Islamabad this weekend, where Vice President JD Vance will lead a US delegation in meetings with Iranian officials. However, sentiment remained fragile amid Israeli strikes in Lebanon and continued disruptions in the Strait of Hormuz that could undermine the peace process. At the same time, markets were weighed by rising copper inventories, with stockpiles in LME warehouses climbing to an eight-year high, signaling subdued demand conditions.