Crude oil futures soared to their highest levels in over two months on Friday, after a series of incidents in the Middle East and production hiccups in the U.S. catapulted domestic prices. The latest spike marks the largest two-week gain since September, prior to the onset of the Israel-Hamas war in Gaza.

While prices had initially dipped early Friday, they quickly rebounded following an attack on an oil tanker in the Red Sea, orchestrated by Houthi terrorists in Yemen. The assault, which disrupted shipping in the region, further heightened tensions.

Several other factors contributed to the surge in oil prices: significant U.S. oil supply and production drawdowns, a potential for increased economic stimulus from China, stronger than expected U.S. Q4 GDP growth, ongoing declines in U.S. inflation, and a drone attack on a Russian oil refinery by Ukraine. “Geopolitical risks are the primary anchor for the sustained oil price support,” highlighted analysts at Commerzank.

Front-month Nymex crude (CL1:COM) for March delivery closed +0.8% higher on Friday, ending the week up 6.5% at $78.01/bbl. This marks its highest settlement value since November 14 and caps its largest two-week percentage gain since the week ending September 8. Meanwhile, Brent crude (CO1:COM) was not far behind, finishing the week 6.3% higher at $83.55/bbl.

ETFs affected by the surge include: (USO), (BNO), (UCO), (SCO), (USL), (DBO), (DRIP), (GUSH), (NRGU), (USOI).

The S&P 500 Energy Index (NYSEARCA:XLE) recorded its most substantial weekly gain since March, climbing +5.1%. This was highlighted by NuStar Energy (NS), which Sunoco acquired in an all-stock deal valued at approximately ~$7.3B.

The top 10 gainers in the energy and natural resources sector over the past 5 days include: NuScale Power (SMR) +38.2%, Verde Clean Fuels (VGAS) +27.5%, Plug Power (PLUG) +26.8%, W&T Offshore (WTI) +24.4%, NuStar Energy (NS) +19.6%, Nabors Industries (NBR) +14.7%, Liberty Energy (LBRT) +14.3%, RPC Inc. (RES) +14.2%, PBF Energy (PBF) +13.6%, YPF (YPF) +13.2%.

The top 5 decliners in the energy and natural resources sector over the past 5 days include: Battalion Oil (BATL) -30.1%, Novagold Resources (NG) -20.9%, Global Gas (HGAS) -14.4%, Brooge Energy (BROG) -12.2%, Chart Industries (GTLS) -12.2%.

Source: Barchart.com