Base metal prices on the London Metal Exchange surged higher at the close of ring trading on Wednesday April 18, with nickel recording the highest intraday price difference since 2009.
The metal found support during the afternoon amid concerns over further sanctions, reaching a high of $15,875 per tonne, the highest since December 2014.
"I think it is fear rather than fact at this stage. Given what has happened in aluminium, and that nickel also has a significant Russian share of global production, it is not surprising that people would seek to reduce exposure to that risk," Guy Wolf, global head of market analytics at Marex Spectron, told Metal Bulletin.
Speculation continues to mount over the metal's sharp spike, with market sources also suggesting the LME's delisting of Russian nickel producer Norilsk's brands a contributing factor.
The LME had announced in October last year it will delist old Norilsk nickel brands within six months.
"There's definitely a fear about a new round of sanctions in general against Russia, which is driving prices up. As far as we understand, no new sanctions are imminent, and I don't really understand the price rise today if you just put it down to sanctions," Daniel Briesmann, analyst at Commerzbank, told Metal Bulletin.
Nickel's volumes also climbed over the afternoon, reaching 23,000 lots, the most since November 2016.
"The most important factor going forward is the entire EV issue. This morning BHP Billiton said they plan to raise output from Nickel West operations in Australia, which could lead to higher demand. However, nickel's price rally started in the afternoon, so it is difficult to create a link there," Briesmann added.
Aluminium's three-month price continued to rocket throughout the day, closing above $2,500 per tonne for the first time since 2011.
The light metal's price sentiment continues to find support after US sanctions against Russian aluminium producer Rusal.
Metal Bulletin Research has pointed to a potential overreaction regarding Rusal news, with continued overbuying a hasty response to sanctions.
Elsewhere, the complex recorded strong gains across the board.
Copper's three-month price climbed back over $7,000 per tonne for the first time since February.
The red metal spent much of March consolidating around $6,800-6,950 per tonne after a volatile trade backdrop continued to affect price sentiment.
Zinc and lead also found support throughout the afternoon, with the former climbing 4.5% at the close.
Base metals rally
Currency moves and data releases