Sovereign wealth funds and central banks that oversee US$29 trillion in assets are increasingly allocating to energy assets, reflecting growing concerns about the U.S. dollar amid a portfolio overhaul prompted by extraordinary geopolitical shifts, a survey released Monday by independent global investment management firm Invesco indicates.
The survey of 90 sovereign wealth funds and 54 central banks revealed a heightened emphasis on diversification and building portfolios resilient to shocks—designed to withstand adversity—even as trade tariffs, restricted shipping routes, and conflicts in Ukraine and the Middle East continue.
Eighty per cent of respondents identified energy security and energy‑transition infrastructure as the most credible means of enhancing portfolio resilience, projecting infrastructure to account for 9 percent of sovereign wealth fund assets by 2026.
The race to construct energy-intensive AI infrastructure further bolstered the appeal, the report added.
“In a landscape of inflationary shocks, geopolitical fragmentation, and increasingly concentrated markets, investors are revisiting traditional diversification concepts and reshaping portfolios to endure a broader spectrum of outcomes,” said Benjamin Jones, head of research at Invesco.
Resilience is emerging as a hard requirement rather than a discretionary luxury.
The recent strengthening of the bond‑equity correlation has weakened bonds’ role in diversification, prompting a shift toward liquidity and real‑asset investments.