Reports emerging overnight from the United States suggest that the Treasury Department has said it may considering lifting the sanctions on the Russian-owned company, if majority owner Oleg Deripaska sells his stake in the group. Rusal is controlled by Oleg Deripaska, who has ties to Russian President Vladimir Putin.
On April 6 the United States imposed economic sanctions on 38 Russian businessmen and senior government officials in response to an alleged poisoning attack on the country's former spy Sergei Skripal and his daughter in the UK.
Last week, aluminum climbed to the highest level in nearly seven years as the curbs on Rusal, the top supplier outside China, set off a rush for alternative supplies.
Shares in aluminium giant Rusal, which have been tumbling since the package was first announced, rose 13 per cent on the news.More news: Twitter improves user data policy ahead of new European privacy laws
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Those announcements saw three-month LME aluminium futures shed over 7% to close at $2,295 per metric tonne.
While analysts have suggested that nationalisation may be the only solution, Russian Finance Minister Anton Siluanov told reporters on Friday that Rusal was not on the list to be nationalized.
"Risks to aluminum prices remain, since the deadline for Rusal sanctions has simply been pushed back until October and we expect the volatility to persist", said Christian Georges, an analyst at Societe Generale. The Kremlin and Deripaska did not immediately respond to requests for comment.
The sanctions did not target Russia's Norilsk Nickel, a major producer of nickel and palladium, but did target one of its major investors, the billionaire Oleg Deripaska.
European leaders had been working to persuade Pres. Trump to ease sanctions on Russian Federation, and Treasury Secretary Mnuchin said the "impact on our partners and allies" factored into the US reprieve.
Relief measures from US sanctions on Russian Federation rippled across the commodities sector Monday, sending crude oil prices down more than 1 percent in early trading.