Gerardo Del Real,
Editor
July 5, 2022
The invasion of Ukraine by Russia and the devastating human toll continues unabated without an end in sight.
I’ve touched on the invasion’s economic subtext in the past and the dicey situation that American policymakers have put the country’s energy dependence in.
America's response thus far has included the banning of imports of Russian oil, gas, and coal.
Notably absent — for now — is an outright ban on uranium. Nearly half of the United States’ uranium comes from Russia, Kazakhstan, and Uzbekistan.
Because politicians in America rarely get ahead of any problem, the U.S. now faces having to fast track a way to lessen its dependence on uranium imports during a high-energy-demand summer while backing a war against the country providing a good chunk of that uranium.
What to do?
Throw a lot of money at it.
This past month, the Biden Administration pitched a plan — which seems to have bipartisan support if you can believe that still exists — whereby the Department of Energy is asking Congress for approval and appropriations to purchase $3.5 billion of domestic low-enriched uranium that is comprised of uranium, conversion, and enrichment services from U.S. suppliers.
The obvious impact is domestic uranium companies and politically-stable jurisdictions that are US allies — like Canada — will benefit greatly from the proposal.
My portfolio is positioned perfectly for the attention the better-quality uranium stocks will be receiving.
Picture a scenario where uranium prices surge to $100 per pound while the U.S. government is lavishing dollars on uranium companies positioned to contribute and the institutions and retail investors simultaneously realize what an obvious trade, speculation, and investment in uranium equities and funds storing physical uranium is.
Energy Secretary Jennifer Granholm has called the US reliance on Russian imports a “vulnerability” for national and economic security. You think?
Uranium fundamentals are already in a bull market, making the recent retracement one that lasts weeks or months — not years.
You’re seeing that right now with the better uranium stocks.
It may last another quarter, it may not.
But you better be positioned for the next leg up because it’s going to be a very profitable one.
Gerardo Del Real
Editor, Daily Profit Cycle