Launched on May 1, 2006, the iShares U.S. Oil & Gas Exploration & Production ETF (IEO Quick QuoteIEO - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Energy - Exploration segment of the equity market.

While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.

Sector ETFs are also funds of convenience, offering many ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Energy - Exploration is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 9, placing it in bottom 44%.

Index Details

The fund is sponsored by Blackrock. It has amassed assets over $439.66 million, making it one of the larger ETFs attempting to match the performance of the Energy - Exploration segment of the equity market. IEO seeks to match the performance of the Dow Jones U.S. Select Oil Exploration & Production Index before fees and expenses.

The Dow Jones U.S. Select Oil Exploration & Production Index is a free-float adjusted market capitalization-weighted index. The Index includes companies that are engaged in the exploration for and extraction, production, refining, and supply of oil and gas products.

Costs

Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.

Annual operating expenses for this ETF are 0.38%, making it one of the least expensive products in the space.

It has a 12-month trailing dividend yield of 2.41%.

Sector Exposure and Top Holdings

While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.

This ETF has heaviest allocation in the Energy sector -- about 99.9% of the portfolio.

Looking at individual holdings, Conocophillips (COP) accounts for about 18% of total assets, followed by Marathon Petroleum Corp (MPC) and Eog Resources Inc (EOG).

The top 10 holdings account for about 71.66% of total assets under management.

Performance and Risk

Year-to-date, the iShares U.S. Oil & Gas Exploration & Production ETF return is roughly 4.83% so far, and is down about 4.59% over the last 12 months (as of 11/28/2025). IEO has traded between $74.87 and $99.44 in this past 52-week period.

The ETF has a beta of 0.80 and standard deviation of 25.9% for the trailing three-year period, making it a high risk choice in the space. With about 51 holdings, it effectively diversifies company-specific risk.

Alternatives

iShares U.S. Oil & Gas Exploration & Production ETF sports a Zacks ETF Rank of 4 (Sell), which is based on expected asset class return, expense ratio, and momentum, among other factors. IEO, then, is not a great choice for investors seeking exposure to the Energy ETFs segment of the market. However, there are better ETFs in the space to consider.

Invesco Energy Exploration & Production ETF (PXE) tracks Dynamic Energy Exploration & Production Intellidex Index and the State Street SPDR S&P Oil & Gas Exploration & Production ETF (XOP) tracks S&P Oil & Gas Exploration & Production Select Industry Index. Invesco Energy Exploration & Production ETF has $73.03 million in assets, State Street SPDR S&P Oil & Gas Exploration & Production ETF has $1.77 billion. PXE has an expense ratio of 0.61%, and XOP charges 0.35%.

Bottom Line

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