Germany backs 35B euro gas plants for data centers

That shift is already showing up in markets. The United States Oil Fund’s sentiment has plunged to “Extreme Fear,” while natural gas trade signals remain neutral, underscoring how investors are rotating away from oil and toward fuels tied to power generation and infrastructure. Europe’s move also reinforces a broader re-rating for gas assets after years of policy pressure on hydrocarbons.

Energy stocks are responding accordingly. XLE has climbed to 65.31 from 57.57 in late July, while gas producer EQT has risen to 54.63 from 48.70 over the same period, helped by expectations that power demand and LNG exports will keep gas balances constructive. UNG, the U.S. natural gas ETF, has been volatile but is holding above its September lows, with its 50-day moving average now above its 200-day average, a sign of improving price momentum even after recent pullbacks.

The macro backdrop supports the trade. U.S. industrial production has edged higher to 102.99 in July from 102.51 in May, while producer prices for all commodities are forecast to rise to 289.77 in August, suggesting energy demand is not fading. For investors, the key question is whether AI electricity demand becomes a durable capex cycle for gas turbines, pipelines and upstream producers — or whether regulation and renewables catch up fast enough to limit the upside.

The next catalyst is execution: permits, grid interconnections, and final financing for the German plants, along with upcoming U.S. gas storage data and earnings from producers and LNG exporters that will show whether power demand is turning into lasting pricing support.