Copper prices just smashed through previous highs, setting a new all-time record. What's driving this surge? Two major factors are colliding right now.

First, LME warehouse inventories have been dropping fast—we're talking about stocks shrinking to levels that make traders nervous. When physical supply gets this tight on the world's benchmark exchange, it sends a clear signal: there's not enough metal to go around.

Second, the looming threat of U.S. tariffs is adding serious pressure. Market participants are bracing for potential trade restrictions that could choke off supply routes even further. The combination of dwindling stockpiles and policy uncertainty is creating a perfect storm scenario.

What we're seeing isn't just a short-term blip. This looks like the early stages of a significant global supply crunch. Industrial demand remains strong while production hasn't kept pace, and now policy risks are piling on top of already tight fundamentals.

The market's reaction? Copper's breaking records, and there's genuine concern about where prices head next if these supply pressures intensify. For anyone watching commodity markets or industrial sectors, this is a development worth monitoring closely.