Why is Ukraine negotiating a minerals deal with the US?
Published On Feb 24, 2025, 8:37 AM
Ukraine is nearing a deal with the US to provide access to its significant mineral deposits, including critical materials like graphite and lithium, which are essential for modern technologies and energy solutions. This agreement, promoted by Ukrainian leaders, aims to enhance US support for Ukraine amid its ongoing conflict with Russia, and to reduce American reliance on Chinese rare earth minerals. However, negotiations have been challenging, with disputes over revenue sharing and control over resources.
Stock Forecasts
ALB
Positive
The news of a potential US-Ukraine mineral deal has significant positive implications for companies involved in mineral extraction and electric vehicle (EV) production, as these minerals are crucial for EV batteries and other technologies. Companies like Albemarle Corporation (ALB), which specializes in lithium extraction, may benefit as they could become key players in a newly opened market for Ukrainian minerals. Overall, if the deal is finalized, it could lead to an increase in investment in mineral extraction companies and the EV sector due to the rise in demand for these critical materials.
LIT
Positive
Given the geopolitical significance and the potential for growth in both the US and European markets regarding mineral resources, exchange-traded funds (ETFs) focused on energy and materials sectors, such as the Global X Lithium & Battery Tech ETF (LIT), are likely to see positive momentum. This is due to anticipated increases in demand for lithium and other critical minerals from Ukraine, which could stimulate interest and investment in these sectors.
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