In 2025, I expect one sector to grab more headlines than any other – and no, it’s not tech.
It’s energy.
We all need energy in our daily lives. Think about how upset we get when we don’t have it – even if it’s because of something temporary like a power outage or a gas shortage in the wake of a storm. We get nervous, anxious, angry, and eager to get back to our normal routines.
Demand for energy is increasing substantially. Global economies are growing. More people are entering the middle class and buying cars and other goods. Perhaps most importantly, cryptocurrency and artificial intelligence consume massive amounts of energy.
One of the most shocking statistics I’ve seen with regard to artificial intelligence is that a ChatGPT query requires 10 to 25 times more energy than a Google search.
Furthermore, President-elect Donald Trump has announced the creation of a new National Energy Council with the aim of establishing “energy dominance” and delivering on his “drill, baby, drill” campaign promise.
That should give a nice boost to U.S. oil production, which has already been setting records. In 2023, the United States produced more oil than any country ever for the sixth consecutive year, and that was with climate-related regulations in place. Assuming Trump repeals many of those rules, that streak will almost certainly continue and production will likely accelerate.
We’ll need the extra supply, considering global GDP is forecast to rise by a solid 2.7% in 2025 – about the same as the estimates for this year. With a pro-crypto president taking office and AI continuing to see increased adoption in everyday life, demand for energy will skyrocket.
Fortunately, there is a movement in the U.S. and around the world to further develop one particular source of energy that’s cheap, clean, and reliable: nuclear. It’s perhaps the one topic Republicans and Democrats in the House and Senate actually agree on.
America and 24 other countries, including the U.K., South Korea, and even the United Arab Emirates, have pledged to work toward tripling global nuclear energy capacity over the next 25 years.
In Trump’s first term, he was supportive of nuclear energy, as he signed the Nuclear Energy Innovation and Modernization Act and provided billions of dollars in loan guarantees to the industry.
He did not offer a lot of commentary about nuclear energy during his recent campaign or after Election Day, but if his goal is U.S. energy dominance, nuclear energy will have to be an important part of the equation.
Natural gas is another plentiful source of inexpensive energy. I’m very bullish on companies in the natural gas space – especially pipeline companies like Enterprise Products Partners (NYSE: EPD), which I’ve held in The Oxford Income Letter‘s portfolio for years.
In addition to its strong growth prospects, Enterprise Products Partners pays a very attractive 6.8% dividend yield.
Lastly, because of the country’s renewed focus on energy, I expect the tech sector to follow the money and increasingly offer products and services to energy companies.
I could easily see 2025 being the “year of energy” in the United States. There should be lots of exciting advancements and investment opportunities to follow.
Be sure to stick with Wealthy Retirement for updates on how to play new developments in the sector over the coming months.
