We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Leveraged Oil & Energy ETFs Soar on Rising U.S.-Iran Tensions
Read MoreHide Full Article
Key Takeaways
Oil's sharp rise lifted leveraged ETFs like UCO, ERX and GUSH on bullish energy momentum.
Supply disruption fears from geopolitical tensions drove short-term gains in crude-linked funds.
Leveraged ETFs amplify daily moves, making them attractive but higher-risk tactical trades.
Oil prices jumped more than 4% on Feb. 18, 2026 after U.S. Vice President JD Vance said Iran failed to meet key American demands during recent nuclear negotiations and warned that military action remains an option if diplomacy breaks down, as quoted on CNBC. United States Oil Fund, LP (USO) added 4.9% on Feb. 18 while the fund gained 0.8% after hours.
Rising Geopolitical Tensions Add Supply Concerns
U.S. envoys Steve Witkoff and Jared Kushner held talks with Iranian officials in Geneva. Iran’s foreign minister Abbas Araghchi described the discussions as constructive. Oil prices had fallen earlier after markets interpreted these comments as a sign that negotiations could succeed.
However, sentiment reversed after Vance said Tehran had not addressed core U.S. “red lines,” as mentioned in the same CNBC article. Meanwhile, Iran conducted military exercises in the Strait of Hormuz — a critical route for global energy shipments — raising fears that oil flows could be disrupted in the event of conflict.
Note that about one-third of all waterborne crude exports pass through this narrow waterway, according to data from energy consulting firm Kpler, as quoted on CNBC. The United States too has strengthened its military presence in the Middle East by deploying aircraft carriers.
Leveraged ETFs to Gain
Escalating tensions could threaten supply of oil through key shipping routes. If oil prices gain in the near term, the below-mentioned leveraged ETF areas are likely to gain.
The ProShares Ultra Bloomberg Crude Oil seeks daily investment results, before fees and expenses, that correspond to two times (2x) the daily performance of the Bloomberg Commodity Balanced WTI Crude Oil Index. The fund UCO added 8.3% on Feb. 18, 2026 while the fund advanced about 1.5% after hours.
The MicroSectors Energy 3X Leveraged ETNs is linked to three times leveraged participation in the performance of the Solactive MicroSectors Energy Index, compounded daily, minus the applicable fees. The fund WTIU added about 4% on Feb. 18, 2026 while the fund advanced about 1% after hours.
Direxion Daily Energy Bull 2X Shares (ERX - Free Report)
The Direxion Daily Energy Bull 2X Shares seeks daily investment results, before fees and expenses, of 200% of the performance of the Energy Select Sector Index. The fund ERX added about 4% on Feb. 18, 2026 while the fund gained about 0.4% after hours.
The Direxion Daily S&P Oil & Gas Exp. & Prod. Bull 2x Shares seek daily investment results, before fees and expenses, of 200% of the performance of the S&P Oil & Gas Exploration & Production Select Industry Index. The fund GUSH added about 3.8% on Feb. 18, 2026 while the fund rose about 0.1% after hours.
Zacks' 7 Best Strong Buy Stocks (New Research Report)
Valued at $99, click below to receive our just-released report
predicting the 7 stocks that will soar highest in the coming month.
View the Zacks #1 Rank List
Image: Bigstock
Leveraged Oil & Energy ETFs Soar on Rising U.S.-Iran Tensions
Key Takeaways
Oil prices jumped more than 4% on Feb. 18, 2026 after U.S. Vice President JD Vance said Iran failed to meet key American demands during recent nuclear negotiations and warned that military action remains an option if diplomacy breaks down, as quoted on CNBC. United States Oil Fund, LP (USO) added 4.9% on Feb. 18 while the fund gained 0.8% after hours.
Rising Geopolitical Tensions Add Supply Concerns
U.S. envoys Steve Witkoff and Jared Kushner held talks with Iranian officials in Geneva. Iran’s foreign minister Abbas Araghchi described the discussions as constructive. Oil prices had fallen earlier after markets interpreted these comments as a sign that negotiations could succeed.
However, sentiment reversed after Vance said Tehran had not addressed core U.S. “red lines,” as mentioned in the same CNBC article. Meanwhile, Iran conducted military exercises in the Strait of Hormuz — a critical route for global energy shipments — raising fears that oil flows could be disrupted in the event of conflict.
Note that about one-third of all waterborne crude exports pass through this narrow waterway, according to data from energy consulting firm Kpler, as quoted on CNBC. The United States too has strengthened its military presence in the Middle East by deploying aircraft carriers.
Leveraged ETFs to Gain
Escalating tensions could threaten supply of oil through key shipping routes. If oil prices gain in the near term, the below-mentioned leveraged ETF areas are likely to gain.
ProShares Ultra Bloomberg Crude Oil (UCO - Free Report)
The ProShares Ultra Bloomberg Crude Oil seeks daily investment results, before fees and expenses, that correspond to two times (2x) the daily performance of the Bloomberg Commodity Balanced WTI Crude Oil Index. The fund UCO added 8.3% on Feb. 18, 2026 while the fund advanced about 1.5% after hours.
MicroSectors Energy 3X Leveraged ETNs (WTIU - Free Report)
The MicroSectors Energy 3X Leveraged ETNs is linked to three times leveraged participation in the performance of the Solactive MicroSectors Energy Index, compounded daily, minus the applicable fees. The fund WTIU added about 4% on Feb. 18, 2026 while the fund advanced about 1% after hours.
Direxion Daily Energy Bull 2X Shares (ERX - Free Report)
The Direxion Daily Energy Bull 2X Shares seeks daily investment results, before fees and expenses, of 200% of the performance of the Energy Select Sector Index. The fund ERX added about 4% on Feb. 18, 2026 while the fund gained about 0.4% after hours.
Direxion Daily S&P Oil & Gas Exp. & Prod. Bull 2X Shares (GUSH - Free Report)
The Direxion Daily S&P Oil & Gas Exp. & Prod. Bull 2x Shares seek daily investment results, before fees and expenses, of 200% of the performance of the S&P Oil & Gas Exploration & Production Select Industry Index. The fund GUSH added about 3.8% on Feb. 18, 2026 while the fund rose about 0.1% after hours.