COM - Energy ETFs rally as OPEC announces production cuts

2023-04-03 12:43:19 ET

Exchange traded funds focused on the oil and gas sectors showed significant strength Monday as a surprise production cut from OPEC caused oil ( CL1:COM ) prices to jump 6% , touching a more than two-month high.

As a result, ETFs that have their price action tied heavily to energy commodities or to the oil and gas industry have gained ground on the session. Some of the top performing funds include the following:

• US Brent Oil ( BNO ) +6.1% .
• US Oil Equipment & Services Ishares ETF ( IEZ ) +5.7% .
• US Oil Fund ( NYSEARCA: USO ) +5.4% .
• S&P Oil & Gas Eqpt & Services SPDR ( NYSEARCA: XES ) +5.7% .
• Vaneck Oil Services ETF ( NYSEARCA: OIH ) +5.6% .

Additionally, the world’s largest energy-based ETF S&P 500 Energy Sector SPDR ( NYSEARCA: XLE ) with its $48.81B assets under management and exposure to companies in the consumable fuels, energy equipment and services industries is also higher by 4.3% .

Oil currently sits near $80.50 per bbl, and received a boost after OPEC’s surprise decision to cut oil production over the weekend. Oil prices now sit at a level not seen since January 27th. At the same time crude now trades above its 100-day moving average as well.

In terms of production cuts, they will start in May and last until the end of 2023 and are led by Saudi Arabia, United Arab Emirates, and Kuwait.

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