The energy sector has been outperforming this year as oil prices are soaring on supply disruptions and unprecedented demand. In fact, many ETFs are again scaling new 52-week highs.

Some of these include Invesco Dynamic Energy Exploration & Production ETF (PXE Quick QuotePXE - Free Report) , First Trust Natural Gas ETF (FCG Quick QuoteFCG - Free Report) , SPDR S&P Oil & Gas Exploration & Production ETF (XOP Quick QuoteXOP - Free Report) , Invesco S&P SmallCap Energy ETF (PSCE Quick QuotePSCE - Free Report) and Invesco DWA Energy Momentum ETF (PXI Quick QuotePXI - Free Report) that are leading the energy space this year.

Oil resumed its strength lately and reached its highest levels since March. Brent oil hit $120 per barrel after Saudi Arabia raised crude prices for July, indicating a very tight supply. The rally came even though OPEC+ agreed to accelerate its output increases over the next two months.

The easing of COVID-19 restrictions in China and the European Union agreement to ban 90% of the Russian crude by the end of the year added to the strength. The dual news will continue to bolster demand and exacerbate worries over the already tightening supply. Additionally, an inflationary environment in many countries as well as the prospect of rising demand from the start of the upcoming U.S. summer driving season caused a spike in oil prices.

Further, the ongoing geopolitical tensions between Russia and Ukraine and in the Middle East heightened concerns over tight energy supply, thereby providing a boost to the oil price (read: 4 Top-Ranked Sector ETFs to Buy for June).

Added to the strong momentum is the state of backwardation in the oil futures market, where later-dated contracts are cheaper than the near-term contracts. This signals that the oil market is tightening and demand is robust, paving the way for an oil rally. This trend is likely to persist at least in the near term, acting as the biggest catalyst for the commodity.

We profiled the above-mentioned ETFs below:

Invesco Dynamic Energy Exploration & Production ETF (PXE Quick QuotePXE - Free Report) – Up 87.7%

Invesco Dynamic Energy Exploration & Production ETF follows the Dynamic Energy Exploration & Production Intellidex Index, which thoroughly evaluates companies involved in the exploration and production of natural resources used to produce energy based on a variety of investment merit criteria, including price momentum, earnings momentum, quality, management action and value (read: 5 Best-Performing Stocks of the Top ETF of May).

Holding 31 stocks in its basket, Invesco Dynamic Energy Exploration & Production ETF has amassed $365.7 million in its asset base and charges 63 bps in annual fees. It trades in a volume of 237,000 shares and has a Zacks ETF Rank #1 (Strong Buy) with a High risk outlook.

First Trust Natural Gas ETF (FCG Quick QuoteFCG - Free Report) – Up 78.1%

First Trust ISE-Revere Natural Gas Index Fund offers exposure to U.S. companies involved in the exploration and production of natural gas. It follows the ISE-REVERE Natural Gas Index and holds 44 stocks in its basket.

First Trust ISE-Revere Natural Gas Index Fund has amassed $1.1 billion in its asset base while charging 60 bps in annual fees. Volume is good, with 1.9 million shares exchanged per day, on average. The product has a Zacks ETF Rank #2 with a High risk outlook.

SPDR S&P Oil & Gas Exploration & Production ETF (XOP Quick QuoteXOP - Free Report) – Up 75.6%

SPDR S&P Oil & Gas Exploration & Production ETF provides exposure to 61 oil and gas exploration and production companies by tracking the S&P Oil & Gas Exploration & Production Select Industry Index.

SPDR S&P Oil & Gas Exploration & Production ETF has AUM of $5.7 billion and trades in an average daily volume of 6.8 million shares. The fund charges 35 bps in fees per year and has a Zacks ETF Rank #1 with a High risk outlook.

Invesco S&P SmallCap Energy ETF (PSCE Quick QuotePSCE - Free Report) – Up 75.1%

Invesco S&P SmallCap Energy ETF offers exposure to the companies that are principally engaged in producing, distributing or servicing energy-related products, including oil and gas exploration and production, refining, oil services and pipelines. It tracks the S&P Small Cap 600 Capped Energy Index, holding 30 stocks in its basket.

Invesco S&P SmallCap Energy ETF has accumulated $208.4 million in its asset base and charges 29 bps in annual fees. It trades in an average daily volume of 414,000 shares and gas a Zacks ETF Rank #2 (Buy).

Invesco DWA Energy Momentum ETF (PXI Quick QuotePXI - Free Report) – Up 70.4%

Invesco DWA Energy Momentum ETF tracks the Dorsey Wright Energy Technical Leaders Index, which is designed to identify companies that are showing relative strength (momentum). The fund has 41 stocks in its basket with AUM of $306.9 million (read: 10 Top-Performing Oil-Energy ETFs of May).

Invesco DWA Energy Momentum ETF charges 60 bps in annual fees and trades in a good volume of 64,000 shares a day on average. PXI has a Zacks ETF Rank #1 with a High risk outlook.