Tuesday, February 01, 2011

Oil ETFs for 2011: One Good Play, and Two You Should Avoid

The protests and social unrest in Egypt have provided an additional tailwind to crude prices over the past week (and we should note that crude had already rallied to two-year highs before the demonstrations began).

1 -Crude oil price chart 3 Year
Even before the hysterics began in Egypt, the trend in oil was UP. (Source: StockCharts.com)

Walk (and Protest) Like an Egyptian

Since the January 25th “Day of Anger” unrest kickoff, there’s been a lot of activity - mostly bullish - in the oil markets.  First, let’s take a look at how WTI and Brent crude prices have responded.

Crude yawned for a few days...but eventually got into gear.  WTI crude for March delivery is up over 5% in the past week.
2 - Crude Oil Week Price Chart

It was a smoother ride up for Brent - though it didn’t run as far as WTI, with Brent for March delivery up over 4% in the past week.

3 - Brent Oil Week Price Chart
Source: BarChart.com

Brent crude is now trading above $100/barrel - a historically high spread with respect to WTI crude.  (And as an aside, HAI's Julian Murdoch talked about how to play the high Brent-WTI sprad recently.)

And how have our favorite oil ETFs performed since the Egyptian protests began?

Please read the rest of my Oil ETF analysis - including your best plays for the short and long run respectively - at Hard Assets Investor.

No comments:

Most Popular Articles This Month