Jorge Vasquez, founder of consultancy Harbor Aluminum, said the UAE exported about 550,000 tonnes of value added primary aluminium to the United States last year and Bahrain exported 150,000 tonnes to the United States.

“The peace agreement gives a reasonable case for the market to consider the possibility of an exemption on aluminum products from the UAE and Bahrain, in which case it would likely be based on hard quotas,” Vasquez said.

U.S. exemptions to the 10% import tariff for primary aluminium or products typically come with informal or formal quotas, imposed last month on Canada, which previously had an exemption.

Hard quotas could mean producers, such as Emirates Global Aluminium (EGA) and Aluminium Bahrain (Alba) ALBH.BH struggle to sell more to the United States than they already do.

“Exemptions could have a larger, longer lasting impact on premiums if the UAE or Bahrain start shipping large amounts of primary aluminium to the U.S.,” an aluminium trader said. “An exemption means more profit for their producers.”

EGA declined to comment on its U.S. exports, but said it sold a total of 2.60 million tonnes of cast metal in 2019, of which 87.4% was value added products.

Alba produced more than 1.36 million tonnes of aluminium last year. “Alba sells mainly billet to the U.S. market. In 2019, 11% of our sales went to the United States,” it said, adding 44% of its sales last year were value added products.

Consultants at CRU estimate global aluminium supplies at 64.1 million tonnes this year, up 1.5% from 2019.