Sovereign investors with US$29 trillion pivot to energy assets, flag dollar fears

Sovereign wealth funds and central banks managing US$29 trillion in assets are turning to energy assets, and raising concerns about the dollar, in a portfolio reassessment driven by unprecedented geopolitical shifts, according to a survey ‌published on Monday by independent global investment management firm Invesco.

The survey of 90 sovereign wealth funds and 54 central banks showed an increasing focus on diversification, and investment portfolios that can “take a hit and still hold it together” amid trade tariffs, closed shipping channels and wars in Ukraine and the Middle East.

Some 80 per cent of those polled said energy security and energy transition infrastructure were the most credible investments for making their portfolios more resilient, and infrastructure reached 9 per cent of sovereign wealth ⁠fund assets in 2026.

The race to build energy-hungry AI infrastructure added to the appeal, the report by the global ‌investment management firm found.

“In a world of inflation shocks, geopolitical fragmentation and more concentrated markets, investors are rethinking old assumptions about diversification and redesigning portfolios to withstand a wider range of outcomes,” ‌Invesco head of research Benjamin Jones said.

“Resilience is becoming a hard requirement, not a nice-to-have.”

The positive bond-equity correlation ⁠in recent years has also ⁠eroded reliance on bonds for diversification, with more focusing on liquidity and real assets.