Exchange traded funds (ETFs) tracking the energy sector were hit on Friday, after news emerged that the Organisation of Petroleum Exporting Countries (OPEC) and Russia are in discussions about increasing oil production once again in response to soaring prices.
Steadily rising oil prices on the back of global geopolitical tensions have made oil ETFs the strongest performers but the sector still harbours fears
Investors had been betting on an oil price rebound ahead of the OPEC meeting last week, and they appear to have been right in doing so, as the oil price has soared after an agreement on a product cut was finally reached.
Long oil ETPs have started taking in money for the first time in weeks, but many investors still remain cautious on the asset class as uncertainly continues around OPEC’s latest decision to curb production. What is the outlook for the oil price and is this volatility here to stay?