JPMorgan Sees Aluminum Rally with Supply Gaps, Gold Falls 1.2%
JPM•Gold fell 1.2% after President Trump vowed to maintain a naval blockade on Iran, while aluminum gained 1.2% to $3,514 a ton as Strait of Hormuz shipments stalled. Greg Shearer, JPMorgan’s head of base and precious metals research, said supply shortages will persist and boost bullion selling pressure.
1. US-Iran Tensions Pressure Metals
President Trump’s vow to maintain a naval blockade on Iran has heightened concerns over shipments through the Strait of Hormuz, a critical chokepoint for oil and metal exports. The uncertainty has rippled through commodity markets, driving volatility in gold and aluminum prices.
2. Gold Prices Dip 1.2%
Spot gold fell 1.2% after jumping the previous session, reflecting traders’ reassessment of rate cut expectations as the energy-supply shock keeps inflation risks elevated. Greg Shearer of JPMorgan noted that ongoing geopolitical uncertainty and potential equity market corrections will sustain selling pressure on bullion in the near term.
3. Aluminum Surges Amid Supply Shortage
Aluminum rose 1.2% to $3,514 a ton on the London Metal Exchange as shipments through the Strait of Hormuz remain halted. Shearer warned that restarting smelters and replenishing global output will take months, likely pushing prices toward $4,000 a ton even if the strait reopens.
4. Implications for JPMorgan
JPMorgan’s metals research team is closely monitoring the conflict-driven supply disruptions, which could boost trading revenues if volatility persists. The bank’s forecasts for prolonged shortages in both precious and base metals may shape institutional and retail client strategies across its commodities division.
