Shares of Vulcan Energy Resources Ltd (ASX: VUL) surged 6% in early trade on Friday.
Investors bid the Vulcan share price as high as $7.64 this morning with the stock today trading at its highest level in around three weeks.
Shares in the lithium miner are trading slightly lower at $7.54 apiece at the time of writing.
In broader market moves, the S&P/ASX 200 Energy Index (ASX: XEJ) has spiked 180 basis points into the green as well.
What's up with the Vulcan share price?
Whilst it's been quiet from Vulcan's camp this month, the price of battery metal lithium continues to remain buoyant near record highs.
Lithium carbonate now rests at 458,500 yuan/tonne having slipped from record highs of 496,500 yuan per tonne in early April.
According to Trading Economics, lithium carbonate traded sideways during May along the lowest level since February amid "stronger supply projections while strict lockdowns in Shanghai eased the metal's surging demand". It added:
Fresh figures showed that lithium carbonate production in China rose by 2% on the month and 30% on the year during April, while supply is projected to further increase in May as COVID lockdowns are expected to recede and capacity is set to rebound for manufacturers.
Lower activity due to the lockdowns also dented demand, as sales of new energy passenger vehicles plummeted 40% on the month in China, with Tesla purchases falling the most.
Motley Fool Australia recently reported: "While Vulcan is not yet producing lithium, the value of its future cash flow is reliant on the commodity's value," adding that "… the premise of Vulcan Energy's goal is to produce lithium at a substantially lower cost than is traditional…"
While news has been quiet on Vulcan's front with the price of lithium remaining top-heavy near its record highs, investors appear to be still looking favourably on such ASX stocks today.
Vulcan share price snapshot
The Vulcan share price has clipped a 3% gain in the last 12 months but has slipped 27% into the red this year to date.
