With oil prices cracking $100 a barrel today, it’s probably hard to believe that it’s only been a few years since prices were negative for the first time in history in May 2020. Due to a lack of demand and pandemic disruptions, oil prices reached as low as negative $37 a barrel. But times have changed in the intervening six-plus years, notably with the resurgent conflict in the Middle East.
And that’s been a big boon to energy stocks. Not only has energy been the best-performing sector in the S&P 500 this year (+46%), but the latest bout of outperformance has also made it the best-performing sector over the last five years (+173%), even beating out information technology (+138%). But individual energy stocks can still seem a tad unpredictable. Oil ETFs are a more efficient way to play the surge.
As we so often say here at Cabot Wealth Network, we’re stock pickers. We prefer to recommend individual stocks—growth stocks, value stocks, small-cap stocks, etc. However, there are occasions when we recommend exchange-traded funds (ETFs). One of those occasions is when there’s a red-hot or rebounding sector and you want to take full advantage of its momentum. Rather than pick one or two stocks, it can make sense to buy an ETF that tracks a whole basket of stocks in that sector.
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That’s why oil ETFs are a good option right now. Here are three that have shown particular strength as oil prices have gained steam.
3 Oil ETFs to Play the Crude Rally
iShares U.S. Oil & Gas Exploration & Production ETF (IEO)
As the name suggests, this ETF holds oil and gas companies specifically focused on exploration and production. It counts ConocoPhillips (COP), Marathon Petroleum (MPC), Valero (VLO) and EOG Resources (EOG) among its 10 largest holdings (out of 46). IEO has returned 56.5% so far in 2026 and is trading at fresh all-time highs. It should stay strong as long as oil stocks stay in gear.
Energy Select Sector SPDR Fund (XLE)
The XLE is essentially a proxy for energy stocks as a group, with holdings that include all of the biggest names in the sector (Exxon (XOM), Chevron (CVX), Phillips 66 (PSX), SLB (SLB), etc.), the 10 largest of which account for 74% of the fund’s total assets. So as crude oil prices have accelerated, so has the XLE; it’s up 42.8% YTD.
PowerShares DB Oil Fund (DBO)
This one’s a bit more niche, but it’s based on the value of crude oil futures contracts, which is where the DBO invests 100% of its assets. When oil prices rise, this fund rises even faster. To wit: as oil prices have risen this year, so has DBO, which is up 110.1% in 2026 alone.
Bottom line: With oil prices again in the triple digits, energy stocks have been a good place to be. Investing in any one of these oil ETFs is a nice catch-all way to play the surge, gaining access to an entire chunk of a fast-moving sector.
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*This post is periodically updated to reflect market conditions.
