Oil prices staying high even if Iran peace comes — load up on energy stocks
Even though peace talks between the US and Iran are progressing, analysts warn that oil prices are unlikely to return to $60 anytime soon. The global oil shock has already pushed China's export prices up at the fastest rate in three years.
Idea
Military strikes on Iran sent oil prices surging, but here's the key insight: analysts say oil is unlikely to drop back to $60 even if peace breaks out. The damage to supply chains is done, and the inflation ripple is already showing up — China's export prices just jumped the most in three years partly because of the oil shock. That means energy companies are collecting fatter profits on every barrel, and those higher profits tend to lift their stock prices. Buying a basket of major oil stocks like ExxonMobil and Chevron through the energy sector ETF (XLE) lets you benefit from stubbornly high oil without betting on any single company.