CRAKETF

The energy sector is the best-performing sector this year, up 53%, driven by elevated oil prices amid supply risks. Investors can gain exposure through commodity ETFs (better for short-term trading) or energy equity ETFs (better for long-term investors).

Energy companies are focusing on shareholder value and offering attractive dividends. The sector represents only 3.7% of broad-market indices, providing diversification benefits. Different energy ETFs show varying performance depending on their position in the oil value chain, with refiners being top performers.

Goldman Sachs predicts diesel and jet-fuel crack spreads will remain elevated through 2027, averaging over $40 per barrel—more than double historical levels—due to refining capacity constraints and potential fuel demand recovery. This outlook supports refiners and pipeline operators, though crude prices are expected to decline. Refined-product inventories are projected to reach their lowest levels since 2015, requiring high utilization rates from refiners.