3 Under the Radar Energy ETFs to Buy with Oil Above $70

© Reuters. 3 Under the Radar Energy ETFs to Buy with Oil Above $70

The energy sector is expected to continue benefiting from rising oil prices, which are being driven by increasing demand due to the resumption of industrial activities and rising mobility. We think investors looking to capitalize on the industry tailwinds in a relatively less risky manner could invest in United States Oil Fund, LP (NYSE:USO), Global X Uranium ETF (URA), and United States Natural Gas Fund, LP (UNG). These under-the-radar funds are well-positioned to benefit from the rising oil prices. So, let’s pore over these funds.As COVID-19-pandemic-led restrictions are easing worldwide with a solid progress on the vaccination front, the demand for oil is rising with increasing mobility and the resumption of industrial activities. This, coupled with continued supply cuts by the major oil producing countries, is leading to a surge in oil prices. The U.S. benchmark WTI Crude hit a 32-month high and Brent Crude surpassed the $73 a barrel mark on June 14.

Furthermore, according to a Research and Markets report, the global oil and gas pipeline market is expected to grow at a CAGR of more than 6% between 2021 -2026. And, despite decent progress in the U.S.-Iran talks regarding the lifting of sanctions, Goldman Sachs (NYSE:GS) expects crude oil to rise to $80 per barrel by the end of the year. Also, even though production cuts may not continue for long, increasing demand for oil is expected to buoy the price rally. While it may be risky to bet on a particular energy stock to benefit from rising oil prices, a less risky way to do so could be to bet on energy ETFs.

We think relatively less followed energy funds United States Oil Fund, LP (USO), Global X Uranium ETF (URA), and United States Natural Gas Fund, LP (UNG) could be solid additions to one’s portfolio now.

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