The Middle East conflict has severely disrupted global energy markets, with Iran choking off the Strait of Hormuz. Crude prices have jumped in response – and the State Street SPDR S&P Oil & Gas Exploration & Production ETF (XOP) is among recent top-performing ETFs, notes Neena Mishra, director of ETF Research at Zacks Investment Research.
Brent crude is trading near $100 per barrel, up roughly 50% since the start of the war. WTI, which more closely reflects domestic crude, has not risen as sharply because US production remains largely unaffected. Even so, it has climbed as global supplies tighten.
State Street SPDR S&P Oil & Gas Exploration & Production ETF (XOP)
Energy stocks have not rallied as strongly as crude. Although higher prices typically support the sector, ongoing regional disruptions are weighing on operations, particularly for companies with physical assets in affected areas. XOP is up about 10%, while the broader State Street Energy Select Sector SPDR ETF (XLE) has gained a little over 5%.
While energy is the top performer, technology has also emerged as one of the strongest sectors since the war began. Investors increasingly treat these stocks as defensive in a period of heightened uncertainty.
Meanwhile, the Breakwave Tanker Shipping ETF (BWET), which provides exposure to crude oil tanker freight rates, has been rising since late 2025 due to Middle East tensions. It is the best performing ETF of the year now.
