Investing.com--Shares of Australian uranium producers rose sharply on Wednesday, ducking weakness in broader markets after the U.S. Senate passed a bill blocking imports of enriched uranium from Russia, heralding tighter global supplies.
Lotus Resources Ltd (ASX:LOT), Bannerman Energy Ltd (ASX:BMN), Deep Yellow Ltd (ASX:DYL), Boss Resources Ltd (ASX:BOE), Paladin Energy Ltd (ASX:PDN) and Peninsula Energy Ltd (ASX:PEN) rose between 2% and 7%, compared to an over 1% loss in the broader ASX 200 index.
The U.S. Senate on Tuesday unanimously voted in favor of a bill blocking the import of enriched uranium from Russia, sending it to the President’s office for approval. The bill comes amid tighter U.S. sanctions against Russia over its 2022 invasion of Ukraine- a conflict that is still showing no signs of de-escalation.
Tuesday’s vote comes after the House of Representatives approved the bill in December. The bill will ban imports 90 days after its enactment, but will also includes waivers in the event of domestic supply concerns.
The bill also includes $2.7 billion in funding support for developing U.S. uranium processing capabilities.
While the bill does cut off another source of revenue for Russia, it also heralds tighter global uranium markets, given that Russia is the world’s biggest exporter of enriched uranium. The country is also the world’s biggest provider of uranium enrichment services.
Enriched uranium is used to power nuclear reactors, which generate electricity.
Uranium futures surged nearly 3% after the passing of the bill, hitting a near two-month high.
The blocking of Russian imports represents an opportunity for Australian uranium miners and processors, who have been otherwise struggling with subdued uranium demand since the 2011 Fukushima disaster in Japan.