|It’s been days since President Trump sent missiles into Syria, targeting chemical weapons facilities. We still have no idea how successful that effort was; the US claims almost every one of its 100 missiles hit its intended target while Syrian ally Russia says Syrian defenses shot down 71 of them.
At this point, it looks like the risk of a real war between the world’s two largest militaries has eased. However, the confrontation is far from over.
For now, focus has just shifted to financial attacks. The US moved first, implementing a suite of new sanctions. Russia responded by introducing legislation that it could use to tighten or even cease uranium trade with the US.
A draft law now before the Russian National Parliament (the Duma) calls for stopping international cooperation in the aircraft and nuclear industries, not only with the US but also with other foreign states that support US sanctions against Russia or support Washington’s position on Syria.
If this law passes, it could create a serious uranium supply shock. The US relies on nuclear reactors for about 20% of its electricity. Only 4% of the uranium feeding those reactors is produced domestically; the rest is imported and almost half comes from Russia, Kazakhstan, and Uzbekistan.
In other words, America is highly reliant on Russia and Russian proxy nations for its baseload uranium requirements. The US relies on Russia alone for between 13 and 16% of its uranium needs.
That’s why this law will make front-page news if approved by the Duma. If that happens, investors will scramble to get uranium exposure.
Those who follow the sector are already playing this opportunity. Just look at the share price of key uranium sector player Cameco: