Countries are scrambling to diversify their energy mix in the wake of what International Energy Authority chief Fatih Birol called the "largest oil price shock in history." South Korea has announced its intention to commit to nuclear power since the Iran war devastated supplies of oil and gas, and more countries could follow suit. Birol told CNBC last week that nuclear power would get a "boost" from the supply crisis. "I don't see a world where demand doesn't increase," Ben Kumar, head of strategy at Seven Investment Management, told CNBC. "I think the last few years have made any country that's reliant on imported energy realize that nuclear power has to be part of their future." Investors have several ways of getting potential exposure to this theme. Uranium production Global production of uranium, the key fuel source for fission reactions that generate nuclear power, is led by Kazatomprom. Based in Kazakhstan but listed in London, the company accounted for around 21% of global output in 2024, according to the World Nuclear Association. Its closest rival, Cameco, accounted for 17%. Its shares have tripled in the last 12 months and are up over 60% year-to-date as it capitalizes on a structural deficit in the uranium market. Demand has long outpaced supply as years of underinvestment in new mines kept production low. Since 2022, Western buyers have sought to divest from Russian producers, further boosting Kazatomprom's share price. KAP-GB 1Y mountain Kazatomprom share price. More broadly, investors could consider funds that comprise a broad bucket of uranium miners, refiners and explorers, such as the Global X Uranium UCITS ETF. The largest nuclear-related fund by assets under management, it tracks the 50+ companies in the Solactive Global Uranium & Nuclear Components index. Its largest exposure is to Canadian giant Cameco Corporation, which comprises 15% of the portfolio. Seven Investment Management's Kumar said he expected Canadian miners to become "very popular", especially the more established players like Cameco, which has a market cap of 72 billion Canadian dollars ($53 billion) and has been mining for nearly 40 years. "There are very few established companies mining and refining, and exploration has been hit by regulations and skepticism," he added. The price of uranium itself The price of uranium is another way investors can access the nuclear theme. Unlike other commodities, however, it is not traded on an open exchange, instead settled by private over-the-counter transactions. One way investors can access the metal's spot price is through holding companies such as Yellow Cake plc, listed on London's Aim. Its business model is to "buy and hold physical U3O8 and engage in uranium-related transactional activities, per its website, which provides investors with liquid exposure to the uranium price. Citi recently added uranium to the illiquid portion of its asset allocation strategy, while Bank of America published a bullish note calling the price up to $135 per pound by 2027. @UXX.1 YTD mountain Uranium spot prices. "Nuclear power continues to (re)gain acceptance as a solution to twin challenges of decarbonization and energy independence," the BofA analysts wrote in a note published March 23. "We are bullish uranium." Current uranium spot prices are around $86 per pound.
