New York, NY – Energy-related stocks surged on Monday as oil prices saw a slight increase. The S&P 500 Energy Sector Select ETF (XLE) rose over 1%, contributing to the overall market gains.
This rise in energy stocks came as crude futures ticked up due to renewed geopolitical tensions and a move by Saudi Aramco to raise prices for its Asian customers, indicating a tight supply in the market.
West Texas Intermediate (CL=F) saw a modest increase of less than 1%, hovering above $78 per barrel. Meanwhile, Brent, the international benchmark price, also experienced gains, trading above $83 per barrel (BZ=F).
Last week, oil prices took a hit, dropping over 6% amidst diplomatic efforts to secure a ceasefire between Hamas and Israel. By Monday, hopes for a diplomatic resolution had dwindled.
Dennis Kissler, senior vice president at BOK Financial, noted in a message to clients on Monday that there had been significant liquidation in the crude market by hedge funds. He suggested that there could be more buying power on standby should renewed geopolitical fears arise.
Overall, the energy sector’s positive performance on Monday was driven by the uptick in oil prices, fueled by geopolitical tensions and supply concerns. Investors will continue to monitor the market closely for any updates on the situation both domestically and internationally.