A major exchange-traded fund manager suggests the oil trade won’t provide much upside ahead.
VanEck CEO Jan van Eck isn’t excited by traditional energy plays, which include the year’s volatile crude trade.
“The core ‘Old Energy’ world is just a sideways world right now,” VanEck CEO Jan van Eck told CNBC’s “ETF Edge” on Monday.
Yet, it has been anything but sideways so far this year for the oil markets. On Wednesday, WTI closed at its highest level since Oct. 8 on jitters surrounding President Trump and Iran. Meanwhile, Brent also settled higher.
WTI Crude Oil
In a special statement to CNBC on Wednesday, van Eck indicated his view hasn’t changed since Monday — citing a one-year time horizon for his outlook.
Instead, van Eck prefers stocks tied to electricity and nuclear power, citing demand from hyperscalers and the broader artificial intelligence trade.
He thinks investors are underestimating the alternative energy’s reliability.
“I don’t think that the ‘R word’ is really understood well enough,” he said. “Data centers can’t be down. They can’t take an hour off.”
His firm is behind the VanEck Uranium and Nuclear ETF (NLR). The fund is up more than 16% since Jan. 1, as of Wednesday’s close. Plus, it’s up almost 73% over the past 52 weeks.
VanEck’s website lists Cameco, Constellation Energy and BWX Technologies as its top three positions, as of Tuesday. Cameco is up 21% so far this year.
Jennifer Grancio, TCW’s global head of distribution, also sees a shift from old to new energy — one that will play out over a long horizon.
“We need all energy sources in order to feed the beast,” she said, pointing to rising power needs for data centers and manufacturing.
Grancio’s firm manages the TCW Transform Systems ETF (PWRD), which she describes as a broad portfolio that includes some traditional-economy exposure, but leans into nuclear and efficiency-related companies tied to the power buildout.
The fund is up about 29% over the past year.