Solar stocks soar as soaring oil prices bolster bets on pivot to renewables

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  • Shares of renewable energy businesses jumped on Tuesday due to soaring prices of oil and other fossil fuels.
  • Enphase and FuelCell were among the stocks in the broader clean energy group that advanced.

Shares of renewable energy companies soared on Tuesday, underscoring moves by investors to take advantage of shortages of oil and other fossil fuels exacerbated by Russiathe invasion of Ukraine.

A batch of solar energy and hydrogen stocks rose, as did exchange-traded funds that house alternative energy stocks. Additionally, the S&P Global Clean Energy Index rose 6% during the day.

Solar Power System Manufacturer Enphase Energy climbed as high as 19% and hit a 1-month high of $182.65 before narrowing the intraday upside to 10%. SolarEdge gained 13% to a more than three-month high and SunRun also jumped 13% to record a seven-week high.

Among hydrogen stocks, Plug hole increased by 10%, Ballard Power jumped 13%, fuel cell energy gained 9.5% and Bloom Energy advanced by 14%. Among alternative energy funds, the H2 Next Generation Defiance ETFs jumped 10%, and the Global Solar X ETF increased by 5.5%.

The moves follow soaring crude oil, natural gas and coal prices following Russia’s invasion of Ukraine nearly two weeks ago. Russia is a major producer of these energies merchandiseand investors pushed prices higher in anticipation of supply disruptions resulting in part from international sanctions against Russia.

The West piled those sanctions on Tuesday. President Joe Biden has said the United States will ban oil imports from Russia. And the The UK has said it will phase out the import of Russian oil and petroleum products by the end of 2022. Crude Brent, the international reference, and West Texas Intermediate Crude climbed on Tuesday, holding firmly around 2008 highs. Brent was trading around $130 a barrel.

Retail investors have dramatically increased their buying of clean energy names, Vanda Research said last week. The retail investment activity tracker said it would monitor whether a backlash against Russia’s reliance on energy imports triggers another wave of retail buying in renewables .

Even before Russia’s attack on Ukraine, energy prices were skyrocketing. Oil had risen as the global market experienced a shortage during a period of high demand as COVID infections and restrictions around the world eased.

And the natural gas market had already faced supply issues after harsh winters in 2020 and 2021, severely depleted inventory in Europe and Asia, Quinn Kiley, managing director and senior portfolio manager at Tortoise, told Insider last week.

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