United States Oil Fund
In the last two parts, we analyzed the best and worst performing midstream MLPs on Wednesday, October 21. To put those movements into context, we’ll analyze the performance of energy-related ETFs and upstream MLPs on the same day.
The United States Oil Fund (USO) fell 2.0% yesterday. USO tracks the daily movement in WTI (West Texas Intermediate) light crude oil. In yesterday’s trade, WTI crude oil for December delivery settled $1.09 lower, or 2.4%, at $45.20 per barrel. The EIA’s (U.S. Energy Information Administration) weekly inventory report showed that crude stockpiles rose more than expected. For context, the upstream energy company heavy SPDR S&P Oil & Gas Exploration & Production ETF (XOP) fell 3.4%.
Most upstream MLPs, which have already lost significant market value since the rout in the energy prices, fell yesterday. They tracked the fall in crude oil prices. The top upstream MLP losers include Legacy Reserves (LGCY), Linn Energy (LINE), Memorial Production Partners (MEMP), and EV Energy Partners (EVEP). They fell 7%, 4.2%, 4%, and 3.5%, respectively. For an in-depth analysis on the recent operating and market performance of the four largest upstream MLPs, read Tough Times: How 4 Upstream Energy MLPs Are Faring So Far.
Upstream companies’ earnings are related to crude oil and natural gas prices. The United States Natural Gas Fund (UNG) tracks daily movements in natural gas futures. It fell 3.2%.
Alerian MLP ETF
The Alerian MLP ETF (AMLP) includes 23 midstream energy MLPs. It fell 1.7% yesterday. AMLP underperformed the SPDR S&P 500 ETF Trust (SPY) by 1.05 percentage points, but outperformed the SPDR S&P Oil & Gas Exploration & Production ETF (XOP) by 1.74 percentage points in yesterday’s trade. SPY tracks the broader S&P 500 Index. It fell 0.61%. AMLP has returned -22.3% YTD (year-to-date), while SPY fell 1.8% over this timeframe.
For more company and industry analysis on MLPs, visit Market Realist’s Master Limited Partnerships page.