The London Metal Exchange (LME) halted nickel trading on Tuesday after prices doubled to a record US$100,000 per tonne, fuelled by a race to cover short positions after western sanctions threatened supply from major producer Russia, Reuters reported.

The news agency said the rare move underscored the market panic created by Russia’s invasion of Ukraine with buyers scrambling for the metal crucial for making stainless steel and electric vehicle batteries.

“The LME has taken this decision on orderly market grounds,” the LME told Reuters, adding it was considering a closure of several days.

“The LME will actively plan for the reopening of the nickel market, and will announce the mechanics of this to the market as soon as possible.”

Three-month nickel on the LME more than doubled on Tuesday to $101,365 a tonne before the LME halted trade on its electronic systems and in the open outcry ring.

Reuters noted the uncertainty caused by Russia’s invasion of Ukraine and resulting sanctions had added to an already bullish nickel market due to low stocks.

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By GlobalData

Nickel prices had quadrupled over the past week on fears of further curbs on supply.

Russia not only supplies about 10% of the world’s nickel but Russia’s Nornickel is the world’s biggest supplier of battery grade nickel at 15%-20% of global supply, JPMorgan analyst Dominic O’Kane told Reuters.