Skyrocketing oil prices might hurt the pocketbook, but they could certainly be a boon for exchange traded funds (ETFs). The price of oil is tip-toeing around $100 a barrel, and shares of some oil companies are rising right alongside it.
The milestone might be staved off for now, since the government reported that supplies at a terminal in the Midwest rose for the first time in weeks, says John Wilen of the Associated Press. Other inventories have fallen, though, so there could be some back-and-forth in the coming days.
ETFs are reaping the benefits of the high costs of oil. The Energy Select SPDR (XLE) is up 28.7% year-to-date and if prices continue to go through the roof, XLE could get a boost. Other energy ETFs include:
- United States Oil (USO), up 21.2% year-to-date
- PowerShares DB Commodity Index Tracking Fund (DBC), up 14.4% year-to-date
- iShares S&P GSCI Commodity Index Trust (GSG), up 17.7% year-to-date
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.