Copper miners face energy delivery, supply chain uncertainty in Commodity News 03/04/2026 Modeled Cost Impacts Show Rising Copper Mining Expenses Under Strait of Hormuz Disruption Geopolitical conflict affecting the Strait of Hormuz is expected to raise copper mining costs through higher reagent, fuel, power, and transportation expenses. Scenario modeling incorporating these disruptions into a 2026 base case indicates a material increase in global copper cash costs, with reagents contributing the largest share. The analysis highlights exposure across regions where mining operations rely on Middle Eastern supply chains for energy and sulfur inputs. Why Middle East Supply Disruptions Are Affecting Copper Mining Cost Structures The closure of the Strait of Hormuz has disrupted oil, LNG, sulfur, and sulfuric acid trade flows, all of which are critical inputs to copper mining and processing. These disruptions are occurring against an already tightened supply environment, amplifying cost pressures across upstream supply chains. The resulting increases in energy and reagent prices are feeding directly into modelled operating and processing costs for copper producers. Key Insights Modeling projects a 5.1% increase in global copper mining costs under updated 2026 assumptions. Reagent prices, particularly sulfuric acid and sulfur, are the largest contributors to modeled cost increases. Fuel and electricity disruptions linked to oil and LNG shipping constraints are affecting mining and milling operations. Regions reliant on oil and LNGfired power grids face higher exposure than those with renewableheavy electricity systems. Mining and processing costs account for 84% of the modeled increase in total copper cash costs. Knockon effects from Iran conflict on nonferrous supply chains Knock-on effects from the conflict in Iran and subsequent closure of the Strait of Hormuz are expected to have a delayed but meaningful impact in the primary non-ferrous markets, especially through upstream supply chains. Updated 2026 base case assumptions for copper mining costs Building on our recent scenario analysis for iron ore, we adjusted our base case for 2026 to incorporate changes in key cost metrics affecting mining operations. Factors such as rising fuel and reagent prices due to ongoing geopolitical disruptions in the Middle East are expected to significantly impact the output and profitability of copper mines. Our modeling projects a 5.1% cost increase across the global copper mining industry, with reagent prices playing a crucial role in this escalation. Sulfuric acid and solid sulfur prices are rising due to trade flow concerns stemming from the closure of the Strait of Hormuz. The ongoing conflict has disrupted oil and LNG shipping, impacting copper operations reliant on these resources. Modeling indicates potential cost increases of over 10 cents per pound for copper, with reagents seeing the most significant rise. Sulfuric acid, sulfur costs rise on an already tightened supply Sulfuric acid is essential in the copper mining industry, serving multiple functions, including acting as a leaching agent to extract copper from oxide ores and as a pH modifier during processing. A byproduct of the oxidation process, sulfur dioxide gas, can be captured and converted back into sulfuric acid, enhancing operational efficiency. Typically, sulfuric acid concentrations hover around 95%. However, operations lacking sufficient in-house production of this reagent may face