MANILA, April 19 (Reuters) - Aluminium prices surged as much
as 5 percent to their highest level in almost seven years on
Thursday amid enduring concerns over strained global supply
following U.S. sanctions on major Russian producer Rusal, with
similar worries also spurring nickel.
    Three-month aluminium on the London Metal Exchange
climbed as far as $2,664.50 a tonne, its loftiest since August
2011, and was trading at $2,626.50 by 0521 GMT, up 3.5 percent.
    The metal has risen by nearly a third since the United
States announced sanctions against UC Rusal, the
world's No. 2 aluminium producer, on April 6. 
    Analysts say worries that the sanctions could hit Russia's
Norilsk Nickel, the world's second-biggest nickel
producer, had lit the fire under prices of the metal used to
make stainless steel.
    "Pretty clearly there is a lot of smoke. And pretty clearly
the U.S. has Russia in its sights for a number of reasons known
to them," said UBS analyst Lachlan Shaw.
    "A logical extension would be if you were to broaden
sanctions, then Norilsk would fall under that remit."
    LME nickel rallied as much as 3.6 percent to $15,825
a tonne, just below Wednesday's peak of $15,875 - the highest
since December 2014 - when the metal soared more than 7 percent.
    "Unlike aluminium, which saw explicit sanctions against
Rusal, there have been no explicit sanctions against nickel
producers," Commonwealth Bank of Australia analyst Vivek Dhar
said in a note.
    "However, markets are still concerned Norilsk Nickel, which
is linked with both Rusal and sanctioned oligarch Oleg
Deripaska, could eventually face sanctions."
    SHANGHAI NICKEL: The most-traded nickel on the Shanghai
Futures Exchange rose as much as 5.9 percent to 109,790
yuan ($17,526) a tonne, its strongest level since June 2015. It
was last up 3.1 percent at 106,920 yuan.
    SHANGHAI METALS: Aluminium and zinc prices in Shanghai also
raced higher. Shanghai aluminium rose 3.1 percent to
15,340 yuan per tonne and zinc climbed 2.6 percent to
24,460 yuan.
    U.S. ALUMINIUM: Aluminium prices in the United States have
soared and are expected to diverge from those traded on the LME
after the U.S. Treasury Department imposed sanctions on Rusal.

    NICKEL DEFICIT:  The global nickel market deficit narrowed
to 2,500 tonnes in February from a revised deficit of 15,800
tonnes in the previous month, the International Nickel Study
Group said.
    BHP IRON ORE: BHP Billiton Ltd cut its 2018
fiscal year iron ore output guidance, citing issues in its
railroad car unloading system, after reporting an 8 percent rise
in third-quarter iron ore production.    
    CHINA BAN: China will ban the imports of 16 more scrap metal
and chemical waste products from the end of this year, the
environment ministry said.
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