All eyes are on the price of oil since around 20% of global supply passes through the narrow strait from the Persian Gulf into the Indian ocean.
But the longer the de facto blockade continues, the greater the knock-on effects of prices and availability of crucial materials, Linesight’s report warns.
It notes that the World Bank’s Global Supply Chain Stress Index is at its highest level since Russia’s full-scale invasion of Ukraine in February 2022.
Steel
Steel prices in Europe swerved upward in February in sync with escalating oil prices because rising energy costs directly affect blast and electric arc furnace production.
Linesight said Europe is most exposed to disruptions to the supply of semi-finished products, but noted that weak demand and structural oversupply could buffer the region against unlimited rises.
Aluminium
The Hormuz crisis is especially serious for aluminium because Gulf countries produce around 9% of global supply, largely for export, and smelters there rely heavily on imported bauxite and alumina, the report said.
The Qatalum smelter in Qatar began shutting down on 3 March because its gas supplies have been suspended. Bahrain’s Aluminium Bahrain smelter has declared a force majeure on its contracts because it can’t ship its product.
Cement
Cement prices have risen, Linesight said, because of rising energy and shipping costs, the latter owing to lengthy detours coupled with higher shipping-fuel prices.
Time is the variable to watch, said Linesight. If the Hormuz crisis is resolved soon, the disruption can likely be absorbed, but a prolonged period of elevated energy and freight costs would “reset cement price baselines across regions”, the report said.
Copper
Copper prices have been rising since before the current conflict, passing the $11,000/tonne mark in October 2025 and the $12,000/tonne mark in January this year owing to keen demand from green energy and data centre projects.
The Gulf region doesn’t produce much copper but it’s a critical supplier of sulphur as a byproduct of oil and gas production. Sulphur is needed to make sulphuric acid, which is essential for copper ore processing.
Linesight said the current war has put nearly half of global sulphur exports at risk, which could drive copper prices higher and faster.
Derek McNamara, Linesight’s vice president of global supply-chain management, said: “Recent disruption is not about a single event, it is the accumulation of energy volatility, constrained logistics and geopolitical risk across multiple routes.
Project owners and manufacturers that focus early on visibility, optionality and realistic lead times are far better placed to protect cost certainty and programme delivery.”
Read the report here.
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