Here we go again. The days of $100 oil made a comeback today as tensions in the Middle East escalated. Oil exchange traded funds (ETFs) are up massively as a result.
Brent crude surpassed $108 a barrel on Monday in Europe (where much of Libya’s oil actually heads), benefiting United States Commodity Brent Oil (NYSEArca: BNO), which is up 3.3% so far today and up 23.3% in the last three months. It’s one of the top-performing futures-based oil ETFs in that time.
Aside from benefiting oil ETFs, the rising cost of oil has been sending gas prices up higher, as well. United States Gasoline (NYSEArca: UGA) is up nearly 3% on the reports today, and in the last six months it has gained 36.8%.
What will this mean for the U.S. economy? Economists generally agree: it wouldn’t be good. The last time oil stayed above $100, it pushed prices at the pump to $5 a gallon in some areas of the country. Consumer spending activity is still weak, so can they really take the hit?
There’s little anyone can do but watch, and look for commodity ETFs to hedge the soaring prices.