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In an escalation overnight, Israel launched a missile barrage against key Iranian sites and military leaders.��

The immediate market reaction has been swift: over $5 per barrel, or seven per cent, to around $73 per barrel. For North American construction professionals, this development signals another round of inflationary pressures, especially for steel and aluminum.��

Energy prices and metal costs: A direct link��

Steel and aluminum production are highly energy-intensive. Any significant spike in energy costs, driven by oil price volatility, translates directly into higher input costs for these essential construction materials.��

 said, “Industry concerns about managing steel input costs to construction just became more complex with the latest clashes in the Middle East.”��

Guckes added, “The data show a long-running, tight connection between oil prices and energy-intensive metal production costs. The jump in oil prices in response to the events in Iran on June 13 could quickly worsen an already difficult picture for metal prices.”��

Tariffs compound the pressure��

The latest round of 50 per cent  imports, announced earlier this month, is already reverberating through the North American market. These tariffs are expected to raise costs across a wide range of products, from vehicles and appliances to building materials and construction projects.��

What construction professionals can expect��

Given the current situation,  should consider the following:��

• Prepare for higher structural steel and aluminum costs, driven by increased energy prices and an evolving tariff environment.��
• Expect a worsening potential for delays or budget adjustments as suppliers adjust pricing to reflect rising input costs.
• Anticipate increased volatility in the metals market, which could make procurement planning and risk management more challenging.��

The recent escalation in the Middle East and a wide-reaching and evolving are poised to push steel and aluminum prices even higher in the coming weeks.��

Construction professionals shouldclosely and consider proactive strategies to mitigate the impact on existing and future projects.��