The Paladin Energy Ltd (ASX: PDN) share price surged 11% into the green today to close at 85.5 cents.
That marks a 22.14% jump in the past two days as uranium shares such as Paladin benefit from record-high uranium prices spurred on by a number of macro-undertones.
Uranium supply shock sends Paladin share price north
Uranium futures rallied hard in late February from a four-month low of US$44 per pound stretching up to US$54 per pound at the time of writing.
That's a 10-year high for the chemical element that supplies energy for hundreds of thousands of individuals and companies around the world.
European conflict has sent uranium prices in the elevator as Russia responded to US-imposed sanctions on oil imports by placing a ban on exports of raw materials overnight, according to Trading Economics.
Some experts even believe uranium could reach US$100 a pound, as Russia accounts for roughly 10% of global exports for the metal.
The supply shock has market pundits nervous and has countries that use uranium for energy scrambling to try and find other means of energy production to make up the shortfall.
"The US nuclear energy sector produces 20% of the country's electricity, and relies on Russia for 16% of its imports," according to Trading Economics.
As Paladin's share price closely traces the path of uranium with just a minor tracking error (shown below), investors were sure to be piling into the company today.
What else is weighing in?
Additionally, skyrocketing commodity markets could be impacting the Paladin share price today.
"…Skyrocketing oil prices prompted nations to shift to alternative energy sources," Trading Economics also said, suggesting the jump is impacting demand–supply curves.
As a result of tension being wound at both ends, uranium futures have climbed more than 95% in the past year and are up 24% in the past month after staying on trend today.
In fact, the Bloomberg Commodities Index (BCOM), a proxy to gauge the strength of the overall sector, has soared to 10-year highs as well just recently.
It remains to be seen what will happen with the flow of various commodities from this trade battle. Regardless, uranium players like Paladin are on the receiving end of some serious capital gains.
The Paladin share price has spiked hard this week and is now up 110% for the past year. However, it is down almost 3% this year to date.
