Geopolitical Tensions Continue to Escalate, Copper Futures Under Pressure [SMM Copper Morning Comment]

Published: Jul 17, 2026 09:26

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SMM, July 17 – Overnight, LME copper opened at $13,615/mt, rose to touch a high of $13,630/mt in early trading, then drifted lower to $13,533/mt, and finally settled at $13,543.5/mt, down 0.28%. Trading volume was 12,000 lots, open interest reached 242,000 lots, down 2,906 lots from the previous trading day, indicating long liquidation. Overnight, the most-traded SHFE copper 2608 contract opened at 104,200 yuan/mt, edged up to 104,550 yuan/mt in early trading, then drifted lower to touch a low of 104,100 yuan/mt, and finally settled at 104,230 yuan/mt, down 0.2%. Trading volume reached 13,000 lots, open interest reached 132,000 lots, down 1,191 lots from the previous trading day, indicating long liquidation. On the macro front, the US-Iran conflict continued to escalate. Iran claimed that the Strait of Hormuz would not be reopened due to US pressure, and the Revolutionary Guard warned that if the US makes a strategic mistake, regional energy exports could be disrupted. Reports said Iran had secretly ordered the Houthis to blockade the Bab el-Mandeb Strait if the US strikes Iran’s power facilities. Meanwhile, the US military carried out airstrikes on airports and transport hubs inside Iran. The White House said Iran is still willing to talk, but there was no sign of a softening in Iran’s position. Overall, although Middle East tensions remain high, expectations of US economic resilience dominated short-term sentiment, and copper prices edged lower. On the fundamentals front, supply remained tight, with both imports and domestic output providing insufficient replenishment. Demand-side consumption was weak, and downstream users only made essential restocking purchases during the off-season. As of Thursday, July 16, SMM data showed that copper inventories in major Chinese markets fell by 41,600 mt WoW to 123,400 mt. Total inventories were 19,900 mt lower than the 143,300 mt recorded in the same period last year. Overall, copper prices are expected to drift slightly lower today.

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