Midstream Stocks Fell the Most Last Week

On December 21–28, midstream stock Shell Midstream Partners (SHLX) fell the most on our list of energy stocks. The Alerian MLP ETF (AMLP) fell 0.9%—the only decline among the major energy subsector ETFs that we discussed in Part 2.

Our list of energy stocks also included the following plus a few integrated energy stocks:

• the Energy Select Sector SPDR ETF (XLE)
• the  SPDR S&P Oil & Gas Exploration & Production ETF (XOP)
• the VanEck Vectors Oil Refiners ETF (CRAK)
• the VanEck Vectors Oil Services ETF (OIH)

Plains All American Pipeline (PAA), Phillips 66 Partners (PSXP), and NuStar Energy (NS) had the second, third, and fifth-largest declines in the energy sector last week. On December 19, the Fed raised the interest rates. Midstream stocks are sensitive to interest rates. The higher rates might be behind midstream stocks’ underperformance.

Upstream stock Range Resources (RRC) was fourth on our list of the top energy losses. However, XOP had the largest rise among major energy subsector ETFs during this period.

The rise in the broader market might have helped these upstream stocks to rise despite oil’s weakness. Last week, US crude oil February futures fell 0.6%. Natural gas February futures fell 11.9%, while the S&P 500 Index rose 2.9% during this period. These energy stocks also underperformed oil and the broader market during this period.