Uranium investors waiting for the all clear to celebrate the fall of Kazakhstan's Government. Pic: RichVintage (E+) via Getty Images.
Kazakhstan’s energy protests could tighten uranium supply and send prices soaring
Energy
share
Kazakhstan’s President Kassym-Jomart Tokayev has accepted the resignation of the Government in an attempt to quell unrest in the country after protests against the sharp rise in the price of fuel turned violent.
Most of the population converted their cars to run on LPG which had a price cap, but on 1 January the government said the low price was unsustainable and lifted the cap, effectively doubling the cost of the fuel overnight.
Tokayev also declared a two-week state of emergency in the Central Asian nation’s biggest city, Almaty, and said some price caps would be restored after crowds in the thousands gathered in the streets across several towns and cities – including oil producing hubs.
#uranium producer workers will join the protest among other oil, gas and coal workers in #Kazakhstan. Energy crisis world wide. Commodity super cycle starts everywhere due to supply disruption. https://t.co/FQeP3Ax3Tv
— Ari Wibowo (@Ari_Wi6owo) January 5, 2022
Kazakhstan produces 43% of global uranium
But it’s not just the fate of the country’s oil rich reserves that have global heads turning.
Kazakhstan also produces around 43% of the world’s uranium, with the country home to the world’s largest uranium producer, Kazatomprom.
Some analysts are predicting the political unrest could send uranium prices soaring.
“#Kazakhstan has had the highest #uranium production in the world… in 2019 was responsible for a whopping 43% of the world’s uranium supply… Needless to say, if the unrest grows to a full-blown political crisis, this could send uranium prices soaring.”⏰👀 https://t.co/OvAV6F4vSx
— John Quakes (@quakes99) January 4, 2022
And traders are on the edge of their seats forecasting the spot price could hit $140, with Kazatomprom having already warned of supply issues this year.
Kazakhstan is having a lot of political issues there with protests on Energy Prices,This is where the largest Uranium producer in the world is,Kazatomprom,They already warned of a Uranium supply issue coming as 700 million lbs of U308 contracts start.Utilities on ALERT?! #uranium https://t.co/yhvAy5l4PT pic.twitter.com/w6lXrmsacS
— Derek Quick (@derekquick1) January 4, 2022
Kazatomprom backed physical uranium fund
In October 2021, ANU Energy OEIC, backed by Kazatomprom, joined the physical uranium fund party.
Like the Sprott Physical Uranium Trust, the fund will hold physical uranium as a long-term investment, with its initial purchases financed through the founders’ round investment totalling $US50m (48.5% from Kazatomprom, 48.5% from the National Investment Corporation of the National Bank of Kazakhstan (NIC), and 3% from fund manager Genchi Global).
The fund is then expected to raise capital of up to $US500 million from institutional and/or private investors, with the proceeds to be used for additional uranium purchases.
At the time ANU Energy said the Fund would be operating in an environment of tightening supply, driving positive benefits for its stakeholders.
And that supply looks set to tighten even further as the world waits to see how the situation in Kazakhstan will pan out.
Who had this #uranium catalyst on their bingo card for 2022? $KAP #Kazakhstan #UraniumSqueeze @FFLJohn pic.twitter.com/VwRS57GdK7
— Uranium Corgi (@UrTokenCorgi) January 4, 2022
