Energy Fuels (UUUU) Surges 10.35% on Geopolitical Tensions, Short Squeeze, and Trump Policy Shifts

Energy Fuels Inc. (UUUU) surged 10.35% on Monday, extending its seven-day winning streak with a cumulative gain of 58.78%. The stock reached its highest intraday level since October 2025, climbing 13.08% during the session, driven by a confluence of geopolitical, market sentiment, and short-interest dynamics.

Geopolitical tensions and former President Donald Trump’s shifting trade policy comments played a pivotal role. Initial warnings of potential tariff hikes on China triggered market jitters, but Trump’s subsequent reassurance that U.S.-China relations “will all be fine” stabilized sentiment. This shift redirected investor focus toward growth sectors, including rare earths and uranium, critical for AI and clean energy technologies. Energy Fuels, a U.S. producer of these materials, benefited from renewed optimism.

China’s export restrictions on rare earths further amplified the stock’s momentum. New regulations requiring licenses for products containing rare earths valued at 0.1% or more of the goods’ total value heightened demand for U.S.-sourced alternatives. Energy Fuels’ competitive positioning in supplying these materials to U.S. manufacturers and tech firms aligned with broader policy goals to reduce reliance on Chinese supply chains, particularly under Trump’s pro-onshoring agenda.

Short-interest dynamics created a self-reinforcing rally. With short interest at 13.54% of the float, the stock’s sustained ascent triggered panic among short sellers, leading to forced coverings that further drove the price upward. The inverse correlation between the stock price and short interest (-36.75%) underscored a “short squeeze” scenario, where rising prices compelled short sellers to unwind positions, accelerating the rally.

Government support for U.S. rare earth production also bolstered Energy Fuels’ prospects. Strategic investments in domestic producers and efforts to secure supply chains for AI, defense, and clean energy technologies reinforced investor confidence. The company’s role in supplying uranium and rare earth elements to U.S. industries positioned it as a key beneficiary of these initiatives, particularly amid growing demand for AI infrastructure reliant on critical minerals.

Market sentiment toward AI and technology sectors indirectly supported Energy Fuels’ stock. Rare earth elements and uranium are essential for manufacturing semiconductors and data center components. As global demand for AI infrastructure expands, so does the demand for these raw materials, solidifying Energy Fuels’ relevance as a proxy for AI growth.

The stock’s rapid ascent reflects a combination of supply-side constraints, geopolitical tailwinds, and market psychology. While concerns about overvaluation persist, the interplay of these factors suggests Energy Fuels may retain upward momentum in the near term. Investors remain cautious, however, given the stock’s sensitivity to macroeconomic shifts and short-interest adjustments.