AA, CENX Stocks Rally: Middle East Crisis Sends Aluminum Futures Near 4-Year Highs

• AA and CENX shares have gained 20% and 28%, respectively, since the start of U.S.-Israeli strikes on Iran on February 28.
• Morgan Stanley recently upgraded Alcoa to ‘Overweight’ and raised the price target to $80, according to The Fly.
• Apart from the conflict, domestic firms are also benefiting from Trump’s tariffs on aluminum imports.

Escalating tensions in the Middle East following U.S.-Israeli strikes on Iran have roiled global aluminum markets, triggering disruptions and pushing futures to near four-year highs amid tightening supply.

Although the Middle East reportedly accounts for about 9% of the world's aluminum production, it plays a much larger role in global seaborne trade. LME aluminum prices have surged past $3,600 per tonne, with Goldman Sachs warning they could climb even higher if regional production losses persist, and Kpler analysts suggesting further escalation could push them toward $4,000 per tonne.

Against this backdrop, two companies have stood out - Alcoa (AA) and Century Aluminum (CENX) - with the shares climbing roughly 15% and 27%, respectively, since the war began.

While the stocks are tracking eleven consecutive months of gains, AA recently recorded its biggest weekly jump since December 2023.

On Thursday, Alcoa posted a 5.2% drop in first-quarter (Q1) revenue, falling below Wall Street’s estimates, according to Fiscal.ai data. However, earnings per share of $1.4 was in line with Street estimates, though they fell around 35% from last year.

Alcoa expects its 2026 aluminum production and shipments to remain unchanged, with output projected between 2.4–2.6 million metric tons and shipments between 2.6–2.8 million metric tons.

For Q2 2026, it anticipates a roughly $15 million sequential hit to earnings in the alumina segment due to weaker bauxite pricing and volumes, and higher energy costs driven mainly by diesel prices amid Middle East tensions.

A Perfect Storm for U.S. Producers

Beyond the broader conflict, CENX and AA have had an additional lift – President Donald Trump’s tariffs on aluminum imports. Trump raised aluminum tariffs to 50% in June 2025 in a bid to curtail cheaper foreign imports and increase domestic investment. Earlier this year, Century Aluminum and Emirates Global Aluminum (EGA) formed a joint venture to build a new smelter, a first such plant built in the U.S. in 50 years.

The supply shock deepened when Iranian missile and drone strikes hit EGA’s Al Taweelah smelter on March 28, with EGA warning restoration could take up to 12 months. Bahrain's Alba also declared force majeure after shutting down roughly 19% of its capacity due to disruptions in the Strait of Hormuz.

Wood Mackenzie estimates the conflict could remove 3 to 3.5 million tonnes of aluminum output in 2026. With the Gulf supply redirected, domestic producers stand to be the beneficiaries.

Analysts Remain Bullish, But Price Target Hinges On Conflict

According to The Fly, JPMorgan increased Alcoa’s price target to $70 from $68, but held a ‘Neutral’ rating, cautioning that the stock’s outperformance is tied directly to Middle East tensions and could reverse if geopolitical risks ease.

Morgan Stanley was more bullish, upgrading Alcoa to ‘Overweight’ from ‘Equal Weight’ and raising the price target to $80 from $64. The brokerage cited the upgrade to higher aluminum prices and Alcoa’s high operating leverage.

Wells Fargo lifted Century Aluminum’s price target to $77 from $69, and added that the outlook hinges on a projected 2026 supply deficit and elevated electricity costs. BMO Capital and B. Riley have also raised Century Aluminum’s target price.

How Did Retail Traders React?

Retail sentiment on Stocktwits for AA was ‘neutral’ and ‘bearish’ for CENX.

One user expects supply disruptions to persist for months, potentially pushing oil and aluminum prices to a higher floor over the long term.

Year-to-date, AA shares have gained around 35% while CENX stock has surged nearly 70%

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