What happened

Bing-bang-boom! Uranium miners Uranium Energy (NYSEMKT:UEC), Ur-Energy (NYSEMKT:URG),and Energy Fuels (NYSEMKT:UUUU) all blew up on Friday -- in a bad way. Down 26.5%, 34.4%, and 36.2%, respectively, as of 3:25 p.m. EST, all three of these uranium energy plays appear to be reacting to negative news out of the Trump administration.

So what

Yesterday, Reuters reported that Energy Fuels and Ur-Energy asked the government to impose a quota requiring that at least 25% of all uranium used in the U.S. also be produced in the U.S. If approved, such a quota could dramatically increase sales by all three of the uranium producers named above -- Uranium Energy included, even if it didn't actively seek the quota. At last report, only 7% of U.S.-used uranium was also produced within U.S. borders.

Fallout shelter sign with radioactive symbol.

Image source: Getty Images.

Citing "sources familiar with the matter," Reuters noted that the U.S. Department of Commerce was expected to decide today among three possible options:

  1. Commerce might require nuclear power operators in the U.S. to buy 5% of their uranium domestically this year, rising 5 percentage points each year thereafter until reaching the targeted 25% quota.
  2. It might postpone making a decision.
  3. It might decline to set any quota at all.

Now what

It appears the answer is going to lie behind Door No. 3.

Although this morning, Ur-Energy and Energy Fuels put out a press release saying they are "unaware" of any decision having been made, the Australian Financial Review is reporting that Australian uranium exporters have "dodged a bullet" because whatever Commerce decides, President "Trump will announce shortly that he won't support recommendations from the US Commerce Department that would force nuclear power station operators to buy a significant portion of the radioactive fuel from US suppliers."

This news report appears to contradict what the companies are saying, but so far, it appears that investors are putting their trust in the media to have gotten this story right. If it turns out AFR got the story wrong, expect a quick turnaround in these stock prices. But for now, they're going down.

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