When the US and Israel launched surprise airstrikes on Iran on 28th February 2026, oil dominated every headline. Oil prices spiked, and analysts warned about tanker routes. The closure of the Strait of Hormuz became a dinner table conversation.
But oil was the consequence, not the cause.
The real trigger was something buried underground, roughly 200 kilograms of uranium enriched to 60%, stored in an underground facility at Esfahan. The International Atomic Energy Agency (IAEA) estimates that’s enough material, if pushed to weapons-grade levels, to build nearly five nuclear warheads.
The US launched what it called a surprise attack right in the middle of nuclear negotiations with Iran. President Trump has since said Iran will agree to no longer enrich uranium. Iran’s atomic energy chief has said the exact opposite. As of now, a temporary ceasefire is in place, but the standoff is far from over.
At the centre of all of it: Uranium.
Most people think of uranium as something vaguely dangerous and exclusively military. The truth is far more interesting.
Today, uranium sits at the intersection of clean energy, artificial intelligence, and geopolitics. And for investors willing to look past the headlines, the structural story is one of the most compelling in commodities right now.
In this newsletter, we will unpack uranium’s story and what the future holds for this metal. The formula is simple: If the US wants it, it may be worth analysing for your portfolio too.
Uranium 101: What Exactly Is It?
Uranium is a heavy radioactive metal dug out of the ground. In raw form, it looks completely unremarkable, just another grey ore. But once processed, it becomes one of the most energy-dense fuels known to science. A single uranium fuel pellet, roughly the size of a fingertip, contains as much energy as:
- 1 tonne of coal
- 560 litres of oil
- 17,000 cubic feet of natural gas
No other fuel comes close.
Here’s how uranium travels from the ground to a reactor:
The step that matters most is enrichment. It determines whether uranium becomes power plant fuel or a weapons-grade material.
- At 4–5% enrichment, it runs a nuclear reactor
- At 90%+, it makes a nuclear weapon
This enrichment percentage is the difference between a power plant and a bomb. It’s why Iran’s uranium stockpile has always been the real issue underlying the US-Iran conflict. And it’s why the word “enrichment” follows uranium everywhere in geopolitical news.
The Demand Story: Nuclear’s Unexpected Second Act
Source: IAEA, Mirae Asset
For decades, nuclear power was deeply out of favour. Construction costs were astronomical. Timelines stretched to 15–20 years. And two accidents burned a permanent fear into public memory.
Chernobyl in 1986 displaced hundreds of thousands. It became a symbol of what could go wrong.
The Fukushima disaster in 2011 sent uranium prices into a decade-long collapse. Germany announced it would phase out nuclear power entirely. Japan shut down most of its reactors. The industry went into hibernation.
But in the last few years, Uranium’s demand story has gained momentum mainly because of two big reasons.
Clean Energy: The world started running out of easy answers to the energy transition. Solar stops working at night. Wind stops working when there’s no breeze. Battery storage helps, but it can’t carry an entire grid for weeks at a time. If you want clean electricity that flows 24 hours a day, 365 days a year, nuclear is one of the very few options that can genuinely deliver it.
At COP28 in late 2023, over 20 countries, including the US, UK, France, Japan, and South Korea, pledged to triple global nuclear capacity by 2050.
The Rise of AI: Running data centres around the clock is extraordinarily energy-intensive. The IEA projects global data centre electricity consumption will more than double to over 945 terawatt-hours by 2030, roughly equal to Japan’s entire annual consumption. Microsoft has signed agreements for small modular reactors in Pennsylvania. Amazon and Google have followed with their own nuclear procurement deals.
India isn’t sitting out of this story either. India plans to grow its nuclear capacity from roughly 7 GW today to 22 GW by 2032. L&T, BHEL, and NTPC are all lined up to participate.
The Supply Problem: Why More Mines Won’t Fix This Quickly
The supply of uranium will not be able to keep up with the rising demand because:
Concentrated Supply Chain: Kazakhstan alone produces 46% of the world’s uranium. Canada contributes 15%, Namibia 11%, Australia 9%, and Uzbekistan 8%. Five countries supply nearly 90% of global production.
Niger’s political transition and ban on Russian enrichment services are creating a bottleneck.
Extended Timeline: New mines can’t plug the gap in time. Discovery to production typically takes 10–15 years. Even if a mine gets approved and funded today, it won’t produce a single pound of uranium until the mid-2030s.
Declining Quality of Ore: Ore grade is the concentration of uranium in rock. The richer the ore, the more uranium you get per tonne dug up. Historically, miners worked with grades of 0.3–0.5%. Today, most operations work with 0.03–0.1%.
Secondary Supply Is Running Dry: For decades, recycled material and stockpiles cushioned the gap between mine output and reactor demand. The US-Russia “Megatons to Megawatts” programme, which converted Russian nuclear warheads into reactor fuel and supplied 10% of global demand, ended in 2013.
What does it mean for an investor?
Source: Cameco
Here’s What I think…
After Fukushima in 2011, uranium entered a decade-long bear market. The industry went into hibernation. Prices crashed from $73 per pound all the way down to $18.
But now Uranium is rallying. From COVID-era lows of $24 per pound in 2020, uranium ran to over $106 by early 2024, a 340% move in under four years. Since then, prices have pulled back to around $65–70 per pound as speculative heat cooled off.
The structural case for Uranium seems to be intact. Demand is growing, and supply cannot respond quickly. But uranium markets are notoriously thin and illiquid, and prices can swing sharply on a single piece of news. A reactor shutdown, a policy reversal, one hostile government, and the whole market reprices overnight.
If you’re looking to take part in Uranium, there are a couple of options. Physical uranium is not being used for obvious reasons.
You can invest in global ETFs like Global X Uranium ETF, Sprott Uranium Miners ETF, and VanEck Uranium+Nuclear Energy ETF (NLR) through the LRS route. These would give you access to Uranium mining and processing companies.
Uranium and its underlying ETFs have already given stellar returns in the past year. So, as an investor, it may be prudent to wait till the momentum in this space cools. Also, if you are considering Uranium in your portfolio, think of it as a diversification element in your commodities exposure rather than for a quick trade.
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Till the next time,
Vijay
CEO – InCred Money
P.S. I share my thoughts on Investing and the Economy regularly. You can follow me here.
