As we look ahead to 2025, there’s one industry poised to dominate the news like no other, and surprisingly, it isn’t technology.
It’s energy.
Consider how essential energy is in our everyday lives. We notice its importance the most when it’s suddenly unavailable, like during a blackout or a gas shortage after a storm. Such disruptions can leave us feeling uneasy, frustrated, and eager to get back to our usual routines.
The demand for energy is on a sharp rise. With global economies expanding, more people are moving into the middle class, acquiring cars, and purchasing various goods. A significant factor driving this demand surge is the burgeoning energy consumption by cryptocurrency and artificial intelligence.
An eye-opening statistic is that each ChatGPT query consumes roughly 10 to 25 times more energy than a typical Google search. This gives you an idea of the scale involving AI’s energy needs.
Stepping onto the scene, President-elect Donald Trump has announced plans to form a National Energy Council. This body aims to achieve “energy dominance,” aligned with his “drill, baby, drill” campaign rhetoric.
This could provide a significant lift to U.S. oil production, which has already been breaking records. For the past six years, America has led global oil production, despite climate regulations. If Trump rolls back these environmental policies, as anticipated, we can expect this upward trend in production to continue and possibly accelerate.
With global GDP expected to climb by a respectable 2.7% in 2025, steady with this year’s projections, and considering the pro-cryptocurrency stance of the incoming administration alongside AI’s growing ubiquity, energy demand is set to soar even higher.
Fortunately, there’s a noteworthy international initiative underway focused on expanding nuclear energy, which is known for being cost-effective, clean, and reliable. Interestingly, this topic has garnered bipartisan support within the U.S. Congress.
The United States, along with 24 other nations including the U.K., South Korea, and the United Arab Emirates, has pledged to work towards tripling the world’s nuclear energy capacity over the next quarter-century.
During Trump’s first term, he backed nuclear energy by signing the Nuclear Energy Innovation and Modernization Act and securing substantial loan guarantees for the sector. While he hasn’t spoken much about nuclear energy in his recent campaigns, achieving U.S. energy dominance would likely require a strong nuclear component.
Natural gas also presents itself as another abundant and affordable energy source. I’m particularly optimistic about natural gas companies, especially those managing pipelines like Enterprise Products Partners (NYSE: EPD). This company has been a staple in The Oxford Income Letter’s portfolio, owing to its impressive growth potential and an attractive 6.8% dividend yield.
With the nation refocusing on energy, I predict the tech industry will start aligning its efforts and innovations toward servicing energy companies.
2025 could very well be dubbed the “year of energy” in the United States. We’re likely to witness numerous exciting developments and investment prospects in this sector as the year unfolds.
Stay tuned to Wealthy Retirement for the latest insights on navigating this dynamic sector in the coming months.
