Top Ways to Trade Gushing Oil Prices

That recent drop in oil prices was good while it lasted.

But it was never going to last.

Today, oil is up $4.54 to $113.80.

All as tensions show no signs of cooling.  In fact, they may be getting worse.  For one, NATO Secretary-General Jens Stoltenberg just said the alliance “is likely to bolster troops along its eastern flank, deploying four new battle groups in Bulgaria, Hungary, Romania, Slovakia.”

Two, according to, “A Russian aircraft has hit an oil refinery in the Donbas region in eastern Ukraine owned by Russian state-owned oil giant Rosneft.”

Three, as noted by, “Biden sees a real risk that Putin will deploy chemical weapons in Ukraine, in comments made while he was leaving the White House for Europe. Biden will join back-to-back summits Thursday with NATO, the Group of Seven and the European Union in Brussels, in an attempt to rally allies and partners behind his administration’s tough approach to Russia and to signal a united front to China.”

But wait, there’s more.

Summer driving season is approaching, and crude supplies just fell.

According to the American Petroleum Institute, crude stocks fell by 4.3 million barrels for the week ended March 18, according to Reuters.

So, how do we trade the ramp up in oil prices?

One way is to trade dividend-paying oil stocks, like Exxon Mobil (XOM).

At the moment, XOM carries a dividend yield of 4.3%.  Also, after pulling back from about $90 to $77.71, the stock has started to pivot higher again. Should oil prices continue to gush higher, we’d like to see XOM test $90 again shortly.

Another way to trade higher oil prices is with an ETF, such as the SPDR Energy Select Sector ETF (XLE), which provides exposure to companies in the oil, gas and consumable fuel, energy equipment and services industries, as noted by State Street SPDR. Not only does an ETF allow for diversification, you can buy it for less.