This Sector Is Unexpectedly Crushing the Rest of the Market This Year

Core Viewpoint - The energy sector has unexpectedly surged in 2026, defying earlier predictions of a downturn due to a global oil glut and declining prices [1][2]. Group 1: Market Performance - As of February 2026, the State Street Energy Select Sector SPDR ETF has increased by 23% year-to-date, outperforming all other S&P sectors and the S&P 500, which is up less than 2% [4]. - Major U.S. oil companies have shown significant returns, with ExxonMobil at 29.3%, Chevron at 21.9%, and ConocoPhillips at 18.8% year-to-date as of February 11, 2026 [4]. Group 2: Drivers of Performance - The rise in energy stocks is theorized to be driven by aggressive U.S. foreign policy, particularly following the capture of Venezuelan President Nicholas Maduro, which may allow companies like Chevron and ExxonMobil access to Venezuela's vast oil reserves [5][6]. - The U.S. administration's potential special access to Venezuelan oilfields for major oil companies is a significant factor, as these companies have the infrastructure to process Venezuelan oil [7]. - Increased tensions with Iran, including military positioning by the U.S., could lead to higher global oil prices, further benefiting energy stocks [8]. Group 3: Investor Sentiment - Some investors are shifting from AI-related stocks back to energy stocks, viewing them as a more reliable long-term investment [9].