China's Rising Aluminum Output Cushions Gulf Supply Shock — Commodities Roundup

MARKET MOVEMENTS:

--Brent crude oil is up 2.7% to $111.83 a barrel.

--European benchmark gas rises 3% to 90.05 euros a megawatt-hour.

--Copper futures are down 1.9% at $14,093 a metric ton.

--Gold futures are down 1.7% to $4,077.50 a troy ounce.

TOP STORY:

China's Rising Aluminum Output Cushions Gulf Supply Shock

China's surging production and export of aluminum is offsetting war-related supply disruptions in the Persian Gulf, helping keep prices in check for one of the world's most widely used metals.

Chinese smelters have ramped up aluminum output over the past few months despite rising energy costs, buoyed by strong margins and cheaper raw-material costs as new refining capacity comes online, analysts said.

The expansion in China's production and export of aluminum comes as the war in the Middle East knocked out hundreds of thousands of tons in regional smelting capacity and blocked a vital supply waterway earlier this year. While China is the world's biggest producer of aluminum, metal makers in the Persian Gulf account for about a tenth of global output, raising fears of a severe supply gap due to the conflict.

OTHER STORIES:

Oil Prices Rise More Than 2% as Attacks on Saudi Arabia, U.S.-Iran Risks Persist

Oil prices rose more than 2% Thursday, with Brent crude climbing above $111 a barrel as traders weighed renewed attacks on Saudi energy infrastructure and the risk of further U.S.-Iran hostilities against recovering Middle East oil supplies.

December Brent crude futures rose 2.9% to $111.96 a barrel, while December West Texas Intermediate futures gained 2.3% to $99.40 a barrel.

The gains followed a mixed session Wednesday, when Brent settled little changed and U.S. crude fell as investors assessed a recovery in Gulf oil exports against continued regional security risks.

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Fortescue Warns of Output Guidance Cut If China Talks Aren't Concluded Soon

SYDNEY-Fortescue FMG, one of the world's biggest iron-ore miners, signaled it could cut annual production guidance if negotiations with China's centralized agency for purchases of the commodity aren't concluded by the end of December.

Fortescue attributed a gap between its iron ore sales for the three months through September and its shipments of the steelmaking commodity to ongoing talks with China Mineral Resources Group, which was founded by Beijing in 2022.

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TransAlta Sells 49% Interest in Oklahoma Wind Portfolio for $305 Million

TransAlta sold a large minority ownership interest in a 500-megawatt wind portfolio in Oklahoma to Ares Infrastructure funds for $305 million.

The Calgary, Alberta-based power generator sold off a 49% stake in the wind portfolio, which includes the 100 megawatt White Rock West, White Rock East and Horizon Hill wind facilities, both generating 200 megawatts each.

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Valero Energy 3Q Profit, Revenue Jump on Refining, Renewable Diesel Strength

Valero Energy reported a surge in profit and revenue in the third quarter, benefiting from higher refining utilization and a rebound in its renewable fuels business.

The energy company posted on Thursday a surge in net income to $6.99 billion, or $23.89 a share, compared with $1.07 billion, or $3.53 a share, in the same quarter a year ago.

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Canada Threatens Cleveland-Cliffs With Forced Sale of Assets Over Layoff Plans

OTTAWA--Canada's federal government formally demanded on Thursday that steel maker Cleveland-Cliffs abandon plans to lay off Canadian workers, adding that failure to comply could lead to a fine or a forced sale of the company's Canadian assets.

Canadian Industry Minister Melanie Joly said the company's layoff plans, affecting workers at two Ontario plants, would violate commitments the U.S. company made when it secured Canadian approval for its 2024 takeover of Stelco.

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Nippon's U.S. Steel to Invest Nearly $3B in Hot Strip Mill Near Pittsburgh

U.S. Steel plans to invest nearly $3 billion in a new hot strip mill at its plant near Pittsburgh.

U.S. Steel, which is owned by Tokyo-based Nippon Steel, said the investment will replace aging equipment with modern steelmaking technology, increasing annual production capacity to about 3.5 million tons from 2.2 million tons. The move also aims to expand the range of steels that U.S. Steel can produce.

MARKET TALKS:

U.S. Natural Gas Futures Steady Ahead of Inventory Data -- Market Talk

1012 ET - U.S. natural gas futures are little changed as the market awaits weekly inventory data from the EIA, due at 10:30 ET. Analysts in a WSJ survey predict a 77 Bcf storage injection, which would shrink the inventory surplus over the five-year average for a 10th consecutive week. Prices have been sliding the past week despite a string of below-average storage builds. "While we had anticipated selling pressure as gas production recovered and weather moderated ... the magnitude of recent losses and feeble attempts to staunch the bleeding reduce immediate-term confidence," Eli Rubin of EBW Analytics says in a note. Nymex natural gas is up 0.1% at $2.794/mmBtu. (anthony.harrup@wsj.com)

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Fears of Middle East Escalation Keep Bid in Oil Futures -- Market Talk

1009 ET - The contradiction between high crude export levels out of the Persian Gulf and high prices "reflects the extent of market fear of renewed supply disruption," Samer Hasn of XS.com says in a note. Prices are sharply higher in early U.S. trading as the Houthis launch attacks against Saudi energy facilities, while the U.S. is reported to be preparing more military options against Iran. "Oil prices are resuming their upward climb amid growing signs that raise the probability of renewed escalation in the Middle East, which could disrupt crude supplies from the region on a wide, multi-point scale and in a way that could be structural," Hasn says. WTI is up 2.9% at $99.94 a barrel, and Brent is 3.3% higher at $112.46 a barrel. (anthony.harrup@wsj.com)

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Gold Falls as Energy Prices Raise Inflation Concerns -- Market Talk

0808 GMT - Gold falls more than 1% as energy prices push higher, adding to inflation concerns. New York futures are down 1.1% to $4,103.20 a troy ounce. "Technically, gold faces immediate support near $4,073, while $4,135 represents an important resistance level," says Naeem Aslam from Zaye Capital Markets. "A sustained recovery above that resistance could bring the $4,150-$4,169 region back into focus, whereas a decisive break below support would increase the risk of further declines." Investors now await next week's Fed meeting for further cues on the monetary policy path and its impact on bullion. (giulia.petroni@wsj.com)

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Brent Rises More Than 3% After Deadly Attack in Saudi Arabia -- Market Talk

0800 GMT - Oil prices climb after another deadly attack in Saudi Arabia. In early European trading, Brent crude gains 3.3% to $112.41 a barrel, while WTI futures are up 2.9% to $99.95 a barrel. Wednesday's attack hit the international airport in the eastern city of Dammam, an oil-producing area near Bahrain. Meanwhile, the State Department ordered the departure of nonemergency U.S. government employees and their family members from Saudi Arabia in response to increased attacks by Yemen's Houthi militants. "Oil production and export have not been materially impacted by the recent increase in attacks by the Houthi militant group against Saudi Arabia, but targeting of production and Aramco facilities will keep a wide geopolitical risk premium in spot oil," analysts at MUFG say. (giulia.petroni@wsj.com)

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Iron Ore Prices Fall Amid Weak Demand Outlook -- Market Talk

0303 GMT - Iron ore prices fall in Asian trade. A weak demand outlook and ample supply continue to weigh on the market, Baocheng Futures analysts write in a note. Chinese steelmakers' profitability remains under pressure, prompting mills to curb production and keeping ore consumption subdued, they say. Port arrivals in China have risen sharply, and shipments from major miners have rebounded, adding to supply pressure. Iron ore prices are likely to remain under pressure. The most actively traded January iron ore contract on the Dalian Commodity Exchange is 1.7% lower at 669.0 yuan a ton. (jiahui.huang@wsj.com; @ivy_jiahuihuang)

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Palm Oil Falls on High Inventories, Production Concerns -- Market Talk

0253 GMT - Palm oil falls in Asian trading, amid concerns over record-high inventories and strong October production, AmInvestment Bank says in a note. However, potential export tax cuts, biodiesel demand and weather-related uncertainties should help cushion prices against steeper declines, it says. AmInvestment Bank pegs resistance at 4,800 ringgit a ton and support at 4,700 ringgit a ton. The Bursa Malaysia Derivatives contract for January delivery is down 8 ringgit at 4,759 ringgit a ton.(yingxian.wong@wsj.com)

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Copper Prices Fall, Prices Expected to Stay Range Bound -- Market Talk

0233 GMT - Copper is lower in early Asian trading. Prices are likely to stay range bound in the near term, according to Nanhua Futures analysts in a commentary. "Uncertainty surrounding U.S. Federal Reserve's policy trajectory, volatility in the U.S. dollar index, and pending U.S. copper tariff policies could amplify price fluctuations," they note. The three-month LME copper contract is 0.6% lower at $14,274.50 a ton. (tracy.qu@wsj.com)

Write to Barcelona Editors at barcelonaeditors@dowjones.com

(END) Dow Jones Newswires

October 22, 2026 11:21 ET (15:21 GMT)