The oil services exchange traded fund is breaking out after Russia stepped in, reportedly backing Syria in case of U.S. military intervention.
The Market Vectors Oil Services ETF (NYSEArca: OIH) was up 1.2% Friday, trading just below $47 and testing its 52-week high. OIH increased 20.1% year-to-date. [Oil ETFs Threatening to Break Out on Syria]
West Texas Intermediate crude oil futures were up 1.9% Friday, trading around $110.4 per barrel. [Oil Prices Lift Energy Explorer and Producer ETFs]
Oil prices and energy sector stocks rose after President Vladimir Putin stated that Russia will continue to support Syria if the U.S. launches a strike against the country in response to alleged the chemical weapon deployment.
“Will we help Syria? We will,” Putin said, Bloomberg reports.
“The involvement by Russia could escalate things and take it beyond Syrian borders,” Kyle Cooper, director of commodities research at IAF Advisors, said in a separate Bloomberg article. “The situation in Syria is fluid and that has the market concerned.”
The Middle East made up about 35% of global oil production in the first three months of the year.