London Metal Exchange stops nickel trading after prices doubled

London Metal Exchange stops nickel trading after prices doubled

After a hurry to settle short positions after International sanctions jeopardized supplies from key supplier Russia, the London Metal Exchange (LME) suspended nickel trade on Tuesday.

The unusual action reflects the market fear sparked by Russia’s invasion of Ukraine, with customers scrambling for the metal used in the production of stainless steel and EV batteries.

The LME, one of the world’s largest commodity exchanges, said it was considering a multi-day closure. The LME will actively plan for the restoration of the nickel market and will inform the market as soon as practicable about the mechanics.

The LME will actively plan for the restoration of the nickel market and will inform the market as soon as practicable about the mechanics.

Due to limited inventories, the uncertainty created by Russia’s invasion and subsequent sanctions has added to an already hot nickel market. Nickel prices have doubled in the last week due to expectations of more supply restrictions.

Nickel prices have doubled in the last week due to expectations of more supply restrictions.

Nornickel, a Russian company, not only supplies around 10% of the world’s nickel, but it is also the world’s largest supplier of battery-grade nickel, accounting for 15% to 20% of worldwide supply.

The LME has given a unit of China Construction Bank (CICHF) more time to settle hundreds of millions of dollars in failed margin calls.

Fears of formal restrictions against Russian oil and fuel exports fueled concerns over supply availability on Tuesday, with Brent rising past $126 a barrel.

Brent crude futures rose $3.07, or 2.49 percent, to $126.28 a barrel in May. The price of WTI crude futures increased to $121.69 per barrel.

Oil supply problems are occurring as global inventories continue to decline. According to five analysts questioned by Reuters, US crude stockpiles fell by around 800,000 barrels on average.

The London Platinum and Palladium Market (LPPM) would keep two Russian precious metals refineries accredited, allowing them to continue selling metal in London. On Monday, the LBMA removed all six gold refineries from its good delivery list.

More at: FXreviewtrading.com

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