Europe to battle with US for aluminium if EU opts for Russian ban

European and U.S. buyers will compete aggressively for Middle Eastern aluminium if the European Union bans Russian metal in coming months, sparking price rises reminiscent of 2018 when sanctions were imposed on Rusal.

A race for aluminium from Middle Eastern countries, including the United Arab Emirates and Bahrain, will fuel inflation for Western companies in the transport, packaging and construction industries - already facing high raw material and payroll costs.

Aluminium is a key ingredient for electric vehicles. Significantly lighter than steel, it is now the metal of choice in a wide range of parts for electric vehicles.

The EU has for months discussed sanctions that would ban Russian aluminium. No new sanctions on aluminium were included in its latest package to mark the second anniversary of Russia's invasion of Ukraine, but the bloc is expected to soon propose another package with new import bans, sources said.