EU and US Set to Compete for Middle Eastern Aluminium Amid Potential Russian Import Ban

The European Union and the United States may find themselves in a tight race for aluminium supplies from the Middle East, should a ban on Russian aluminium imports materialize. This development, as reported by Reuters, underscores the strategic significance of aluminium, a crucial component in the manufacturing of electric vehicles, among other applications, and its potential impact on Western industries.

The scramble for aluminium, primarily from Middle Eastern countries like the UAE and Bahrain, is anticipated to drive inflation within the Western transport, packaging, and construction sectors. This situation bears resemblance to the aftermath of the 2018 US sanctions against Rusal, which led to notable price surges in the aluminium market.

Middle Eastern producers, as per the International Aluminium Institute, contributed 6.2 million tonnes of aluminium to global shipments last year, representing nearly 9% of the worldwide supply. Of this, 2 million tonnes were directed towards Europe and the US. The impending exclusion of Russian aluminium, which could result in a 500,000-tonne deficit in Europe, poses significant challenges in swiftly shifting focus to Middle Eastern producers to bridge this gap.

While the EU has deliberated on imposing sanctions and potentially banning Russian aluminium for several months, the sector remained unaffected in the latest round of sanctions. However, sources indicate that the EU is poised to introduce new restrictions soon, signaling a potentially transformative period for the global aluminium market and its stakeholders.