The world seems to be moving further and further away from the idea of ‘make love, not war.’ Conflicts continue to erupt everywhere, with no end in sight.

Recently, the US Department of Defence has updated its Arctic strategy, as the Arctic is becoming a strategic area of competition between the world's major powers.

Experts predict that the Arctic could have its first ice-free summer by 2030. As the ice melts, new shipping routes will open up, and access to underwater resources will increase.

Within the Arctic Circle are an estimated 90 billion barrels of undiscovered oil, 1,670 trillion cubic feet of gas, and critical metals and minerals necessary for today's economy.

What is at stake is above all money. Those who can control the most critical resource areas will not only gain additional income but also influence others.

Will it at least reduce resource prices?

Unlikely. It is essential to understand that resource extraction is quite costly. Companies must first deal with icy roads, remote areas, and specialized rig transport.

According to a World Wildlife Fund analysis, oil prices would need to range between $63 and $84 per barrel to break even, which is close to current levels.

No one will work at a loss, so companies and countries will try to keep prices at acceptable levels. It is therefore too early to say that black gold will lose its charm.

How valuable is all this information for investors?

The significant investments that countries are making in the Arctic and the extraction of natural resources there suggest that demand for oil and gas will remain high for decades.

This does not mean that the ESG agenda is a lost cause or that alternative energy sources will cease to be developed. Only that they are unlikely to be sufficient on their own.

As AI grows, the demand for electricity increases, and wind and solar power alone cannot meet that demand. For now, it is likely that we will have to rely on traditional energy sources.

On the other hand, rising geopolitical tensions will affect countries' rearmament needs and investments in this sector. Adding related companies to the watch list would be a good idea. Using a stock screener to identify these companies can help in making informed decisions.

Still, caution is warranted as to whether now is the right time to bet on these stocks. Further deterioration in the global economy could hurt energy prices in the short term.