Benchmark three-month copper on the London Metal Exchange climbed 2.1% to $13,437 a metric ton on Thursday, marking the latest leg in a sustained rally for industrial metals.

The rebound was driven by growing market confidence that diplomatic channels between the United States and Iran could lead to a de-escalation of hostilities in the Gulf region.

A softer US dollar also provided tailwinds for dollar-denominated commodities, supporting the price recovery.

The move extends a positive trend for copper, which had already advanced for three consecutive sessions earlier in the week.

Previous gains were underpinned by similar geopolitical optimism, as traders priced in the potential for a diplomatic agreement to stabilize shipping routes and reduce risk premiums embedded in energy and metal prices.

The broader industrial metals complex has benefited from this shift in sentiment, with aluminium also rebounding from earlier losses amid improved risk appetite.