Aluminium extends price fall on United States sanctions reprieve

Adjust Comment Print

Aluminium prices continued to fall on Tuesday after Washington gave U.S. customers of Russian producer United Company Rusal more time to close out their business with the company and comply with sanctions.

Aluminum stocks are plunging after the United States said it would consider relaxing sanctions against a Russian company.

Shares in Rusal, one of the world's largest aluminum companies, rose 13 percent on the Moscow Exchange after the announcement after earlier ending down 8.4 percent in Hong Kong trading.

Aughinish and its hundreds of employees have been caught up in an economic storm since the U.S. imposed sanctions on Rusal, with Deripaska seen as having close ties to Russian president Vladimir Putin.

The Office of Foreign Assets Control (OFAC) of the US Treasury extended the deadline for ending transactions with the Russian aluminum producer Rusal until October 23, 2018, the OFAC said.

Rusal fell into the list of U.S. sanctions because of its involvement with Oleg Deripaska, but the United States government does not want to affect the working people who depend on Russal or its subsidiaries. The price of Rusal had fallen by nearly 70 percent after the announcement.

Alex Oxlade-Chamberlain a doubt for World Cup
Georginio Wijnaldum , who replaced Oxlade-Chamberlain during the tie, said: "I just spoke with him in the dressing room and what the manager said is hard ".

It also said it would not impose secondary sanctions on non-U.S. entities engaged with Rusal or its subsidiaries.

The news that the company could be saved has caused shares in the company to surge - after Rusal had previously shed half of its value on the stock market, as investors jumped ship following the blacklisting by America.

These peculiarities of the USA sanctions policy are both a blessing and a curse for President Vladimir Putin's Russian Federation.

Wood Mackenzie analysts say the decision provides "much-needed breathing space" for the aluminum market, and it "expect (s) near-term correction and volatility" in prices.

"It's very hard for mining companies to react to the tweetstorm", said Gallagher, referring to short-lived moves in spot prices based on fears about U.S. trade policies, amid U.S. President Donald Trump's pronouncements on social media.

Rusal declined to comment on requests from worldwide media, while Deripaska's spokeswoman wasn't immediately available.