Diesel price surge putting mining profits to test
Rising fuel bills are squeezing copper and iron ore producers, while strong bullion prices help miners protect profit margins.
Rising diesel prices are testing the profitability of mining operations, as higher fuel costs are impacting production and transportation expenses. Disruptions in the Strait of Hormuz have further exacerbated the situation, increasing the cost of transporting liquefied natural gas and other energy shipments. Mining companies such as Antofagasta, Capstone Copper, Barrick Mining, Kinross Gold, and Monument Mining have reported rising operating expenses due to the surge in diesel prices.
For instance, Barrick Mining's gold production cost rose 17% between 2025 and 2026, while Ivanhoe Mines reported a $385 million EBITDA in Q2 2026 despite a 18¢/lb diesel cost increase. Ivanhoes Mines founder and co-chairman Robert Friedland stated that their Kamoa-Kakula copper mine generated $385 million in Q2 EBITDA due to stronger copper prices and smelter economics.
Despite the challenges, gold miners have benefited from record high gold prices, which have helped protect margins. However, the industry may face a cost squeeze if metals prices begin to fall and interest rates rise.
Written by urgent.news from Mining.com's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
