Energy sector surges 51% YTD, outperforming consumer discretionary by 56%
- Energy Select Sector SPDR ETF (XLE) up over 51% YTD, outperforming Consumer Discretionary (XLY) by 56 percentage points.
- European Natural Gas prices surged 163% since the Iran war began; heating oil and jet fuel rose 80%.
- WTI crude futures declined 1.97% to $91.89; Brent futures fell 1.68% to $104.86.
*this image is generated using AI for illustrative purposes only.
Creative Planning Chief Market Strategist Charlie Bilello highlighted a stark divergence in sector performance, noting a 56-percentage-point spread between the best and worst performing S&P 500 sectors year-to-date. The Energy Select Sector SPDR ETF (XLE) rose over 51%, while the Consumer Discretionary Select Sector SPDR ETF (XLY) declined 5.4%.
Bilello attributed this gap to war-driven inflation, stating it is rewarding energy stocks while squeezing consumers. In pre-market trading, XLE was up 0.39% to $66.28, whereas XLY closed down 0.51% at $112.27 on Monday.
Commodity prices surge since Iran war began
The analyst pointed to significant price increases across various commodities since the conflict with Iran started. European Natural Gas led the gains with a 163% increase, followed by sulfur at 89%.
| Commodity | Price Change |
|---|---|
| European Natural Gas | +163% |
| Sulfur | +89% |
| Heating Oil | +80% |
| Jet Fuel | +80% |
| Diesel | +67% |
| Rice | +62% |
| Sugar | +50% |
| Gasoline | +46% |
Bilello noted that diesel costs surged 67%, prompting measures such as allowing dyed diesel for highway use. The national average gas price was $4.3413/gallon, down 1.43 cents from the previous day, though the analyst warned the inflationary shock continues to build.
Oil prices retreat
Despite the broader commodity rally, oil-related instruments declined during pre-market trading. The United States Oil Fund (USO) slipped 1.21% to $149.23, and the ProShares Ultra Bloomberg Crude Oil (UCO) fell 1.41% to $58.27.
West Texas Intermediate (WTI) crude futures for November 2026 dropped 1.97% to $91.89, while Brent futures for December declined 1.68% to $104.86.
How might the Federal Reserve respond to persistent inflationary pressures from rising energy and commodity prices?
What are the potential long-term impacts on consumer discretionary spending if inflation remains elevated?
Could other sectors, such as industrials or utilities, face similar headwinds due to rising input costs?
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