Futures & Commodities

Russia demands compensation for US steel tariffs

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Key Points
  • Russia demands compensation for US steel tariffs.
  • Moscow has joined other nations in seeking rebates from Washington via the WTO.
  • The action comes as metal prices surge following sanctions.
A worker cuts a steel coil at the Novolipetsk Steel PAO steel mill in Farrell, Pennsylvania.
Aaron Josefczyk | Reuters

Russia has demanded compensation from the United States for its decision to impose global tariffs on steel and aluminum.

A statement from the World Trade Organization (WTO), circulated at the request of Moscow, describes Donald Trump administration's decision as a "safeguard measure" that under WTO rules should trigger payments from the U.S. to major exporters.

China, India and the European Union have already described the U.S. tariffs as "safeguards."

On March 8, the U.S. imposed tariffs on imports of certain steel and aluminum products. The tariff increase was 25 percent for some steel products and 10 percent for aluminum products.

Metals surge

Metals prices have been moving higher following U.S. sanctions on Russian individuals and companies.

The price of the three-month aluminum London Metal Exchange (LME) contract has shot up in value by almost a third so far this month after the U.S. measures effectively cut off Russian firm Rusal from global trading. The lightweight metal is used in the manufacture of cans, automobiles, and airplanes.

Nickel matte in a worker's cupped hands.
Gillianne Tedder | Getty Images

Traders have also suggested that U.S. sanctions on Russia could now expand to affect nickel, which has seen its price rise more than 10 percent this week. The metal is used mainly for the production of stainless steel but is also found in many other items such as coins and rechargeable batteries used in mobile phones.

The three-month contract for nickel on the LME was up more than 7 percent in early trade Thursday at $16,690 a ton, a level not seen since 2014. By 11:25 a.m. London time (6:25 A.M. ET), some of that fizz had evaporated but the metal still stood 3 percent higher.