Unlike other energy segments, the infrastructure segment may be more insulated against volatile crude oil pricing. For instance, the sector has demonstrated its resilience, even when faced with severe price pressures in recent years. As the U.S. becomes more energy independent, the new developments will benefit North American infrastructure businesses, MLPs and GPs
“OPEC’s failed 2014-16 attempt to bankrupt U.S. shale producers highlighted the power of American capitalism,” Lack added. “Domestic drillers responded by cutting costs and innovating. As a result, production remains strong.”
USAI’s top holdings include Cheniere Energy 10.3%, Energy Transfer Equity 8.7%, Williams Cos 8.5%, Kinder Morgan 8.5% and Enbridge 8.0%. The index will usually target 15% U.S. midstream GP partnerships, 35% U.S. midstream GP corporations, 20% U.S. midstream companies, 25% Canadian midstream companies and 5% U.S. midstream MLPs.
For more information on the crude oil market, visit our oil category.