For investors seeking momentum, Vanguard Energy ETF (VDE Quick QuoteVDE - Free Report) is probably on radar now. The fund just hit a 52-week high and is up about 51% from its 52-week low price of $68.64/share.

But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:

VDE in Focus

VDE focuses on the energy segment of the U.S. market, holding a basket of 133 stocks. It is a large-cap centric fund with key holdings in the integrated oil & gas, and oil exploration and production segments. The fund charges investors 10 basis points a year in fees and has top holdings in Exxon Mobil (XOM Quick QuoteXOM - Free Report) and Chevron (CVX Quick QuoteCVX - Free Report) (see: all the Energy ETFs here).

Why the Move?

The energy sector has been an area to watch lately especially after the Organization of the Petroleum Exporting Countries (OPEC) reached a historic deal to cap its oil production for the first time in eight years. The 14-member cartel will reduce production by 1.2 million barrels per day from the current 33.6 million barrels for six months starting in January 2017. If the deal is implemented, the oil market will regain its balance and shift from surplus to deficit very quickly in 2017, ending the two-year crude-oil rout.

More Gains Ahead?

Currently, VDE has a Zacks ETF Rank of 3 or ‘Hold’ rating with a High risk outlook, so it is hard to get a handle on its future returns one way or the other. However, many of the segments that make up this ETF have a strong Zacks Industry Rank, so there is definitely some promise for those who want to ride this surging ETF a little further.

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