The energy sector is bustling on Monday, as the rally in crude oil prices approach a 13-month peak and help catalyze investor interest in the sector.
With stocks like Exxon Mobil gaining more than 4.54% higher on Monday, the SPDR Energy Select Sector ETF (XLE) jumped 4.1% and was the largest winner among the SPDR ETFs tracking the S&P 500’s 11 key sectors, with 23 of 24 equity components gaining ground.
The energy ETF was headed for a sixth straight gain, making it the longest such streak since the six-day stretch ended June 8, 2020. Other key components of the ETF outperformed as well, with shares of Marathon Oil Corp. surging 13% toward an almost one-year high. Occidental Petroleum Corp. gained almost 12% to peg a roughly 11-month high.
“Numerous drivers appear to continue to support investors’ appetite for increased risk, which favors cyclical plays such as the energy sector,” Truist analyst Neal Dingmann wrote in a note to clients.
Meanwhile, crude oil futures surged roughly 2% to breach $58 a barrel, targeting the highest close since January 2020, amid pandemic-recovery enthusiasm and expectations for the passage of additional stimulus by Congress.
This is good news for Iraq, which needs crude oil to trade at $80 a barrel to be able to eliminate its budget deficit, according to oil minister Ihsan Abdul Jabbar Ismail.
In an interview with Shafaq news agency, the top official said that “Iraq will export in 2021 about one billion and 100 million barrels of crude oil according to market data. The budget needs 140 trillion dinars ($96 billion). The price of $ 80 a barrel is the right price to make Iraq can pay the budget dues.”
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