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Uranium Prices Soar: How War in Ukraine and Europe's Stake in Nuclear Power Are Driving the Surge

October 27, 2023

By:

Federico Sieder

Uranium, often referred to as "yellowcake", has experienced a remarkable price hike in the past month with prices rising by approximately 12%.

In a surprising turn of events, uranium prices have recently reached their highest level in over a decade, highlighting a worldwide resurgence in nuclear power. This surge has been spurred on by various factors, notably the ongoing conflict in Ukraine, which has ignited fresh discussions on Europe's energy supply and the  significant role of  nuclear energy.

Uranium, often referred to as "yellowcake", has experienced a remarkable price hike in the past month. Prices have soared by approximately 12%, with the current price per pound standing at a robust $65.50. This escalation surpasses the peak reached last year and hasn't been witnessed since 2011, according to data from data pricing provider UxC.


One of the primary drivers behind the demand for uranium is the war in Ukraine. The full-scale invasion of Ukraine by Russia has sent shockwaves through global energy markets. This conflict has disrupted the availability and reliability of conventional energy sources, such as oil and gas, exposing the fragility of the world's energy infrastructure. The Russian aggression against Ukraine led governments worldwide to seek for new alternatives to ensure energy independence and a stable energy supply.

In the heart of this nuclear renaissance lies Europe, a continent divided over the role of nuclear power in its energy transition. Two distinct camps have emerged, each with its own vision of the future.

The "nuclear alliance," with France as its informal leader, comprises Belgium, Bulgaria, Croatia, the Czech Republic, Finland, the Netherlands, Romania, Slovakia, Slovenia, Sweden, Hungary, Estonia, Italy, and Poland. France is a central player, with nuclear power accounting for the largest share of its electricity generation.

The country's commitment to nuclear power was made evident in President Emmanuel Macron's recent announcement of the construction of six additional reactors by 2035, with the possibility of expanding to a total of 14 new reactors by 2050. Most other countries in the nuclear alliance are also considering or planning new nuclear projects.

Macron is to visit Kazakhstan and Uzbekistan next week, as France seeks to counter Russian influence in the former Soviet republics and strengthen economic ties in countries with high amounts of raw materials, including uranium. Previously, France and Mongolia have signed a $1.7 billion deal that paves the way for the mining of uranium in the landlocked country.

In contrast, the "opponents and skeptics" camp includes Germany, Austria, Denmark, and Portugal. These countries harbor concerns about nuclear power's dependence on external suppliers, particularly Russia. Russia plays a pivotal role in providing nuclear fuel and uranium conversion and enrichment services.

Currently, 18 reactors in five EU countries rely on Russian nuclear fuel, and nearly 20% of total uranium imports to the EU come from Russia. Hungary is also actively pursuing nuclear projects in partnership with Russia, further complicating the matter.

To ensure a stable supply of nuclear fuel, many EU member states have sought alternative agreements, such as Bulgaria's deals with the US-based company Westinghouse and the Czech Republic's agreements with Westinghouse and French company Framatome.

The central point of contention in Europe's nuclear debate revolves around whether nuclear power should be classified as "clean energy" and receive the same recognition as renewable energy sources. Proponents of nuclear energy, led by France, argue that low-carbon nuclear power, including its role in hydrogen production, should be considered a clean fuel.


They advocate for a revision of EU targets to increase energy production from renewable sources, with such increases conditioned on the recognition of nuclear power's clean energy potential.

In the face of opposition, proponents stress that nuclear power is one of the cleanest and safest ways to generate electricity, pointing out its reliability and lower carbon emissions when compared to fossil fuels.

As the debate rages on, uranium's global resurgence is unmistakable. With its capacity to provide reliable, carbon-free energy, nuclear power is being reconsidered as a crucial component in the fight against climate change and energy uncertainty.

Referred as "the new gold," uranium ETFs have grown 20 times in the past 3 years and, according to senior ETF analyst Eric Balchunas, "they could grow 2 to 3 times in next two years as the world comes around to reality that any hopes of net zero will require a whole lotta nuclear."

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