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What if US Crude Actually Does Stay above $50?

PART:
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Part 3
What if US Crude Actually Does Stay above $50? PART 3 OF 5

Oil’s Rise or Natural Gas’s Fall: Which Impacted Energy ETFs More

Energy ETFs

The list below shows the major energy sub-sector ETFs and their correlations with US crude oil active futures between September 14–21, 2017:

  • The SPDR S&P Oil & Gas Exploration & Production ETF (XOP): 84.2%
  • The VanEck Vectors Oil Services ETF (OIH): 57.9%
  • The Alerian MLP ETF (AMLP): 36.3%
  • The Energy Select Sector SPDR ETF (XLE): 29.8%

Oil’s Rise or Natural Gas’s Fall: Which Impacted Energy ETFs More

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XOP, which had the highest correlation with oil prices, rose 3.3% in the trailing week and outperformed other energy sub-sector ETFs. OIH and XLE rose 1.6% and 0.5% during this time period.

However, AMLP fell 2.1% during this time period, while US crude oil futures rose 0.4%.

Natural gas

The following energy sub-sector ETFs had these correlations with natural gas prices between September 14–21, 2017:

  • AMLP: 80.6%
  • OIH: 67.6%
  • XOP: 30.8%
  • XLE: 30.2%

In the trailing week, natural gas prices fell 4%, and this could explain the fall in AMLP, which had a low correlation with crude oil but a high correlation with natural gas prices.

The S&P 500 Index

In the trailing week, the S&P 500 Index (SPY) rose 0.2%. The following energy sub-sector ETFs had these correlations with the S&P 500 Index (SPY) between September 14–21:

  • OIH: 67%
  • AMLP: 27.1%
  • XOP: 13.7%
  • XLE: -13.7%

Based on these correlations, both oil and natural gas prices impacted energy ETFs during the week, but in different ways and to different degrees. Some of these energy ETFs were also impacted by sentiment across the broader equity market.

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