Energy stocks once again outperformed the rest of the market as oil and gas prices remain elevated due to inflation; despite ongoing risks to tight global supply such as Russia's invasion ofUkraine, some experts are now predicting that prices will decline by next year.
According to some analysts, oil and gas prices will moderate by the beginning of next year.
Since the West imposed sanctions on Russian oil, supply has been tight and energy prices have gone up.
Despite their first weekly loss in over a month last Friday, oil prices jumped again on Tuesday: The price of U.S. benchmark West Texas Intermediate sits at nearly $111 per barrel, while international benchmarkBrent crude trades at more than $114 per barrel
Major energy companies were among the best-performing stocks on Tuesday as the market rebounded from its worst week in over a year.
The shares of Diamondback Energy and Exxon Mobil increased in value, as did the shares of other companies.
Energy prices are down compared to earlier this month, with some experts now predicting that prices may have peaked and could be set to moderate by early next year.
"Any country that is going to sanction Russian oil has likely now done so, and global oil producers have a strong profit motive to produce more."
The price of oil and gas should decline by early next year. It's important that energy companies do well in order to fill the shortfall left by the sanctions on Russian oil exports.
With the possibility of further sanctions against Russian oil exports still not off the table, demand for energy will remain high. He thinks that prices will stay above $100 per barrel throughout the summer.
The S&P 500 energy sector has risen 40% this year as the rest of the market has fallen. Some of the top performers in the energy sector include Marathon Oil, which has risen 49% and 41% so far in the year.
Since peaking at a 14-year high of $139 per barrel in March, the price of oil has remained above $100 per barrel. Russia's invasion could disrupt global energy markets. If the price of oil goes up as much as $150 per barrel, the US will see gas prices go up to over $6 per gallon. With high inflation leading to surging gas prices in recent months, President Joe Biden is considering suspending the federal gasoline tax.
How to invest during a recession is a topic discussed by experts.
Exxon Mobil shares hit an all-time high as oil and gas prices keep rising.
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