Nuke stocks rocket: Besides Venezuela, what’s going on?

Nuclear energy stocks soared on Monday as traders focused on government backing for the sector andlooked ahead to a House committee hearing on Wednesday against a backdrop of heightened geopolitical tensions that could boost demand.

Oklo, Nuscale and Nano Nuclear posted doubled digit gains as US energy policy came into sharp focus following the strike on Venezuela and capture of president Maduro, while the Department of Energy detailed recipients of $2.7bn in funding over the next decade to improve domestic output of uranium. Oklo and Nuscale both jumped 15%, while Nano rose 12% on high volumes.

Lightbridge (+10%), Critical Metals (+15%), Energy Fuels (+10%), Uranium Energy (+7%) and Centrus Energy (+10%) also posted strong gains Monday with Centrus set to receive $900mn of the investment, which is designed to enhance energy security and reduce reliance on foreign suppliers for enriched uranium.

Why are nuke stocks on the move?

The imprisonment of Maduro could threaten America’s rare earths deal with China – a Venezuelan ally and major buyer of its oil – which could tighten supply and raise prices for metals such as uranium. Yesterday also saw lithium prices moving up.

Higher uranium prices and tighter supply could make the new modular nuclear reactors being built by the likes of Oklo more appealing as they are expected to be more efficient. Nuclear fuel suppliers like Centrus could see increased demand and higher prices, while the US government may also seek to take out more equity stakes in companies such as uranium miner Energy Fuels, as it did with MP Materials last year.

Meanwhile, traders were looking to favourable regulatory tailwinds potentially emerging this week. On Wednesday the Energy and Commerce Subcommittee on Energy is holding a hearing to discuss the licensing, deployment, and implementation of recently enacted federal laws and administration policies in nuclear energy.Oklo, Nano Nuclear and Nuscale are all makers of untested and as-yet-unapproved small modular reactors, so any moves by lawmakers is critical to their share prices.

And it all comes against a backdrop of soaring energy demand from AI, which is seen is a major structural tailwind for nuclear energy stocks.