Goldman Sachs raised its second-quarter LME ​aluminum average ⁠price forecast to $3,200 a tonne from $3,100, citing supply ‌losses from Middle East disruptions and the shutdown of the Mozal ​smelter in Mozambique.

LME aluminium traded at $3,260.50 at 2215 GMT.

Goldman removed ​roughly 850,000 tonnes ​from its 2026 supply forecast, reflecting reduced output at Qatalum in Qatar, which is operating at ⁠60% after a controlled shutdown, and at Aluminium Bahrain (Alba), which has idled 19% of capacity.

The bank also assumed a 30% drop in Iranian output due to energy ​infrastructure damage ‌and cut ⁠Mozal’s 560,000-tonne capacity ⁠after it entered care and maintenance.

On the demand side, Goldman ​cut 600,000 tonnes from its 2026 outlook ‌as higher energy prices weigh ⁠on global GDP growth, lowering its forecast for aluminium demand growth to 0.1% from 0.9% previously.

It now expects a 550,000-tonne surplus in 2026, narrower than the 800,000-tonne surplus previously projected, and forecasts a sharp 900,000-tonne deficit in Q2 as inventories fall to historical lows, keeping prices near current levels.

Goldman said risks to prices ‌remain skewed higher, warning that extended disruptions to ⁠Strait of Hormuz flows could deepen Middle ​East curtailments and potentially push the 2026 average LME price toward $3,400.

However, elevated speculative positioning, potential upside in Chinese supply ​and reduced ‌demand switching from copper may limit gains.

(Reporting ⁠by Anmol Choubey in ​Bengaluru; Editing by Mark Porter and Cynthia Osterman)