Back to top

Image: Bigstock

Energy ETF Winners in Oil's Best Week Since October

Read MoreHide Full Article

Last week, crude oil recorded its largest weekly price jump since last October, largely due to hopes of a demand recovery in China after the country’s reopening and reversing its zero-Covid policy that had devastated industrial activity and put pressure on oil demand. Investors booked profits too probably in fear of upcoming economic slowdown.

Brent crude ETF (BNO - Free Report) and WTI crude ETF USO added about 7.1% and 6.4% last week, respectively. In December, OPEC forecast that oil demand this year would increase by 2.2 million bpd, down from 2.5 million bpd last year, per oilprice.com. Now with China opening its economy, the scenario should change for the better.

Slowing U.S. inflation also given a boost to oil prices. The annual consumer U.S. inflation rate for December that was the slowest since October 2021. This has reinforced the hope that the Fed would slower its rate hike momentum in 2023. This, in turn, should keep the greenback subdued and favor the commodity investing. Also, there is news that Russia may cut oil output.

Against this backdrop, below we highlight the winning energy ETFs of last week.

ETFs in Focus

SPDR S&P Oil & Gas Equipment & Services ETF (XES - Free Report) – Up 8.4%

Oil & Gas Equipment & Services takes 71.55% of the fund while Oil & Gas Drilling takes about 28.45% of the fund. The fund has a total of 33 stocks in its kitty. No stock accounts for more than 5.35% of the fund. The fund has a Zacks Rank #2 (Buy).

Invesco Dynamic Oil & Gas Services ETF (PXJ - Free Report) – Up 7.9%

The underlying Dynamic Oil Services Intellidex Index is composed of stocks of 30 U.S. companies that assist in the production, processing and distribution of oil and gas. The Zacks Rank #2 fund’s holds Halliburton, Schlumberger and Baker Hughes in its top three spots. The net expense ratio of the fund is 63 bps in fees.

Invesco S&P SmallCap Energy ETF (PSCE - Free Report) – Up 7.8%

The underlying S&P SmallCap 600 Capped Energy Index is designed to measure the overall performance of common stocks of US energy companies. The Zacks Rank #2 fund puts 52.47% weight in energy equipment and services. Helmerich & Payne (12.72%), SM Energy (9.69%) and Patterson-UTI Energy (8.99%) hold the top three spots in the fund.

VanEck Oil Services ETF OIH – Up 7.3%

The underlying MVIS U.S. Listed Oil Services 25 Index tracks the overall performance of U.S.-listed companies involved in oil services to the upstream oil sector, which include oil equipment, oil services, or oil drilling. The Zacks Rank #2 fund holds 25 stocks in total. Schlumberger NV (20%), Halliburton (11.74%) and Baker Hughes (8.38%) are the top three stocks of the fund.The fund charges 35 bps in fees.

iShares U.S. Oil Equipment & Services ETF (IEZ - Free Report) – Up 7.1%

The 29-stock fund has a Zacks Rank #2. Schlumberger (22.28%) and Halliburton (21.53%) hold the top two positions in the fund. The fund charges 39 bps in fees.

Published in