LONDON: Copper prices sunk to a three-month low on Thursday on worries that surging oil prices will hit global growth at the same time the market is swamped with plentiful inventories. Benchmark three-month copper on the London Metal Exchange gave up 2.5% to $12,091 a metric ton after dropping to $12,034, its lowest since December 24. “What higher oil prices do is curb demand across the economy, and if you curb demand that just means less metal being used,” said Carsten Menke, analyst at Julius Baer in Zurich. “We also have a broader risk-off wave in financial markets, which is impacting copper.” Benchmark Brent oil prices jumped to their highest in more than a week to over $119 a barrel after Iran attacked energy facilities across the Middle East following Israel’s strike on its South Pars gas field, a major escalation. The most-active copper contract on the Shanghai Futures Exchange lost 4.5% to close at 94,430 yuan ($13,686.30) a ton after declining to the lowest since December 19. The escalation in the war and spike in oil prices rattled investors, sparking a slump in equity markets while the dollar was steady. A firmer dollar index makes commodities priced in the U.S. currency more expensive for buyers using other currencies. Traders also warily eyed the growing pile of copper building up in exchange-certified warehouses, with another 1,475 tons arriving in LME sheds, daily data showed on Thursday. That lifts the total to 335,425 tons, the highest since August 2019 and up 135% so far this year. “Inventories have been building up for many weeks, which was largely disregarded, but seemingly market participants are now realizing that,” Menke said. His price target for LME copper in three months time is $11,500. Among other LME metals, aluminium dropped 2.3% to $3,321 a ton, zinc lost 1.5% to $3,086, lead gave up 1.2% to $1,890, nickel slid 2.6% to $16,700 and tin tumbled 5% to $42,800. Lead hit an 11-month low, zinc touched its weakest in three months while tin dropped to its lowest since January 6.