From vulnerability to investment: the implications for the energy system

The current macro backdrop has highlighted the fragility of global energy supply chains and the extent to which many economies remain dependent on imported oil and gas. This reliance makes countries acutely vulnerable to supply disruptions and commodity price shocks, with knock-on effects for inflation, industrial activity and competitiveness. Levels of net fossil fuel imports as a share of primary energy demand underscore how exposed many economies remain.

As a result, perceptions of risk and reliability have shifted. Countries are now prioritising security of supply, redundancy and domestic or allied sourcing of fuels, power and critical inputs. Disrupted oil and gas flows act as a catalyst to accelerate investment in renewables, nuclear power, grids and storage. These are highly capital and metal intensive, requiring significant build-out of energy infrastructure and supply chains, despite ongoing cost, permitting and supply bottlenecks.

Rising geopolitical risk is translating into a clear investment response across three core themes:

Together, these forces are accelerating capital deployment into localised, reliable and alternative sources of energy.

Rebuilding reserves and the re-engineering of energy supply chains

Existing energy infrastructure will require significant repair and replacement, with LNG projects in particular likely to take several years to rebuild or expand. At the same time, rising and more diversified energy demand is renewing the focus on replenishing conventional oil and gas reserves, which is currently close to 20‑year lows.

Renewables and nuclear

Renewables are becoming central to the energy mix. Globally, wind and solar are taking an increasing share of electrical generation from fossil fuels, a trend expected to accelerate as energy security concerns intensify.

Meanwhile, nuclear power is re‑emerging as a key source of reliable, low‑carbon baseload, reducing exposure to fuel imports and intermittency. This has important implications for uranium demand as governments look to secure stable, long‑term power supply.

Electricity grids and storage

Electrification at scale requires modernised grids, power management and storage. The EU is targeting a rapid expansion in energy storage installations this decade, highlighting the scale of infrastructure investment required [1]. Batteries are increasingly central to both power system resilience and the extension of the transition into transport and industry.

Electric vehicles (EV)

Electrification is also accelerating in transport. China’s exports of electric vehicles, lithium-ion batteries and solar products rose 70% year-on-year to a record US$21.9 billion in March 2026, signalling strong global demand [2].

EV adoption directly reduces reliance on petrol and diesel, a shift reinforced by improving economics: for the first time, new electric cars are now cheaper on average than petrol models in the UK, removing a key barrier to adoption and strengthening electrification as a durable substitute for oil demand [3].

What does this mean for investors?

At Aberdeen, we offer three strategies aligned to this theme: Future Supply Chains, Future Raw Materials and Future Minerals. They invest in the companies helping to ensure the resilience of energy supply chains, and the minerals underpinning these technologies.

Future Supply Chains

Supply chains are becoming more regional, more resilient and more capital‑intensive, supported by infrastructure, energy systems and technology. Rather than optimising for cost alone, tomorrow’s supply chains will prioritise flexibility, resilience and strategic control.

Our Future Supply Chains strategy is designed to capture this transformation by investing in companies positioned to benefit from the recalibration of global trade.

An example is US-based LNG producer and exporter Cheniere Energy, which has benefited from its position at the intersection of global gas scarcity and constrained LNG infrastructure. Heightened energy security concerns have reinforced expectations of a multi‑year LNG build‑out, supporting performance across the broader LNG value chain.

Future Raw Materials

This strategy provides equity exposure to the materials underpinning the infrastructure required for energy security and electrification. Key inputs include copper (critical for EVs, power grids and renewables), nickel and lithium (essential for batteries), rare earth elements (vital for semiconductors and permanent magnets used in EVs and wind turbines), and uranium (key for nuclear energy).

A relevant company is Cameco, a Canada‑based uranium producer. As power systems face growing strain, nuclear energy is increasingly valued for its reliable, low‑carbon baseload role, positioning uranium producers like Cameco as key beneficiaries of the energy security theme.

Future Minerals

Here, we offer diversified, actively managed exposure to critical minerals across the full value chain – from extraction and processing to recycling:

Within the strategy's up- and downstream bucket, we believe CATL stands to be one of the key beneficiaries of energy resilience. As a global leader in EVs and grid‑scale batteries, CATL plays a central role in reducing dependence on fossil fuels and supporting renewable‑led power systems. This makes it a beneficiary of the push toward electrification and more resilient energy infrastructure.

Final thoughts…

Whatever the outcome of the conflict in the Middle East, it has raised fundamental questions around the resilience of global energy supply chains. These concerns are reinforcing investment in energy grids, nuclear power and renewables as countries seek more independent sources of energy and a more diversified energy mix. Put simply, security of supply is no longer optional – it’s shaping investment decisions.

We believe Aberdeen’s thematic range is well placed to capture this opportunity, targeting the structural trends underpinning the shift towards a more resilient and secure energy system.

For further information on our strategies, please visit our website.

Companies selected for illustrative purposes only to demonstrate the investment management style described herein and not as an investment recommendation or indication of future performance.

[1] AccelerateEU, Jefferies, March 2026

[2] https://powerphilippines.com/solar-battery-ev-exports-from-china-hit-record-usd-21-9b-in-march-surge-70/

[3] Jefferies, April 2026, quoting Autotrade Group