Beyond oil: How Gulf conflict is reshaping global metals industry

The recent conflict in the Gulf has not only threatened global energy supplies but has also exposed vulnerabilities in international metals markets, according to an analysis by energy expert Robin M. Mills published in The National. In his opinion piece, Mills argues that disruptions caused by the conflict have reverberated through supply chains for aluminium, copper, lithium and other critical minerals, creating challenges that could persist long after hostilities subside.

Drawing on the famous observation by German statesman Otto von Bismarck that "blood and iron will decide the great questions of the day," Mills contends that modern warfare remains deeply dependent on industrial metals. However, he notes that the Gulf conflict has demonstrated how fragile the global metals ecosystem can be when a strategically vital region is disrupted.

According to Mills, the conflict has affected the metals industry in four key ways. The first has been the disruption of trade routes, particularly through the Strait of Hormuz, a crucial shipping corridor for both raw materials and finished metal products. The near-total closure of the strait severely restricted the movement of essential industrial goods.

The second impact has been energy shortages that forced production shutdowns. Aluminium smelting, one of the most energy-intensive industrial processes, was particularly affected. Mills highlights the closure of Qatar's Qatalum smelter after interruptions to gas supplies, underscoring the sector's dependence on reliable energy sources.

Third, the conflict caused direct damage to major industrial facilities. Mills notes that the Gulf accounts for roughly 9 per cent of global primary aluminium production, with major plants in Bahrain and the United Arab Emirates reportedly suffering damage during attacks. He also points to significant strikes on Iranian steel facilities in Ahvaz and Isfahan, which could take months to repair.

A fourth and less visible consequence involves disruptions to supplies of sulphur, a critical industrial material. As Mills explains, sulphur is a by-product of processing the Gulf's "sour" oil and gas resources and is essential for producing sulphuric acid, which is widely used in mining copper, uranium, nickel and lithium. Any shortage could therefore affect global production of metals crucial for clean energy technologies and battery manufacturing.

The analysis argues that these disruptions are particularly significant because they affect sectors considered central to the global energy transition, including renewable power generation, electric vehicles, battery production and data infrastructure.

While Mills believes aluminium shortages are unlikely in the long term due to abundant global reserves and new smelting projects, he warns that copper faces more serious challenges. Declining ore grades, labour disputes, political instability in mining regions and lengthy development timelines have already tightened supplies, even before the effects of the Gulf conflict were fully felt.

Looking ahead, Mills suggests that governments and industry leaders will need to rethink supply-chain resilience. He points to alternative transportation projects such as the UAE's Etihad Rail network, the Oman-UAE Hafeet Rail project and Saudi Arabia's Land Bridge railway as potential ways to reduce dependence on maritime routes through Hormuz.

Ultimately, Mills argues that Gulf countries should pursue three parallel strategies: strengthening logistics networks, deepening integration into global mineral supply chains, and supporting regional stability and reconstruction. In his view, the future competitiveness of the region's metals industry will depend not only on industrial investment but also on lasting peace.

As Mills concludes in The National, while conflicts may be shaped by iron, the foundations of future prosperity could increasingly rest on copper, sulphur, aluminium and lithium.

By Sabina Mammadli