Uranium prices have risen to their highest level since the beginning of the war in Ukraine amid market convulsions and the European energy crisis, the Financial Times and Markets Insider reported.

Uranium has risen 7% since mid-August, surpassing the $50 mark it last touched in the spring amid supply woes. Before that, the last time the price rose above $50 was in March 2021.

But analysts expect the price of uranium to rise further, with Bank of America predicting it will hit the $70 mark next year.

The war in Ukraine and the energy crisis it provoked in Europe forced European countries to look for alternatives to the import of energy carriers from Russia, when Gazprom completely stopped supplying natural gas to several EU countries, including Germany, the largest European economy.

The EU’s energy woes have also been exacerbated by a historic drought this summer, while intense heat has also caused difficulties for hydropower operators.

Earlier in September, German Economy Minister Robert Habeck announced he would delay the final shutdown of two of the country’s last three remaining nuclear power plants as part of efforts to reduce its dependence on Moscow.

Global pressure on uranium prices

In addition to the crisis in Europe, decisions made in other parts of the world affected the price of uranium.

For example, lawmakers in California, the US state with the strongest economy, voted on September 1 to extend the operation of its only nuclear power plant for another 5 years.

On the other hand, Japan has announced its intention to build its first new nuclear power plants since the 2011 Fukushima accident.

“Germany and California have been two of the most negative jurisdictions in the world on nuclear power, and both are opting out. I’d say hell will freeze over before that happens,” says Per Yander, director of nuclear and renewable energy at Dutch company WMC Energy.

“It will have an immediate impact on the markets,” he notes.

The price of uranium also rallied last year, posting a 30% gain as investors bet that nuclear power will be a central component of the transition to a green economy and away from fossil fuels.