U.S. crude oil prices today crossed $51 per barrel mark, a level not seen since the month of July. The gains are being made on the back of fresh supply outages in Nigeria. Indeed, oil’s rally from its lows in early February has been driven to an extent by a series of supply outages. However, the fundamental picture is also improving.
Data released by the American Petroleum Institute (API) on Tuesday showed that U.S. crude inventories once again declined. Declining production in the U.S. and the supply outages have meant that the glut in global oil market could end sooner than expected.
Given the bullish outlook for oil prices, the Horizons BetaPro S&P/TSX Cap Energy Bull (ETF) (TSX: HEU) is worth a look. In the last three months, HEU has already gained almost 25%. But with oil prices continuing to gain momentum, HEU could see further upside.
Year-to-date, HEU is now up more than 38%. However, the ETF is still trading well below the levels it traded in mid-2014 when the slide in oil prices began. In fact, HEU is still almost 70% below the levels it traded in last June.
