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Oil prices were up on Monday, buoyed by hopes the U.S. government shutdown could end soon, per Reuters, boosting demand in the world’s top oil-consuming nation. Brent crude added 0.82% to $64.15 a barrel, while West Texas Intermediate climbed close to 1% to $60.31. This recovery helped stabilize sentiment after two back-to-back weeks of losses that were driven by oversupply fears. USO ETF has suffered sharp volatility this year. Track its live prices. ETF Reaction: Energy Funds Staging A Comeback The rebound in crude is reflected in oil-focused ETFs. The United States Oil Fund (NYSE:USO), which tracks near-month WTI futures, saw a pickup in trading volumes as investors bet on higher short-term prices. Meanwhile, the ProShares Ultra Bloomberg Crude Oil (NYSE:UCO), a leveraged ETF that amplifies daily oil price movements, drew speculative interest from traders seeking to ride the rebound. Broader energy-sector plays also crawled up. The Energy Select Sector SPDR Fund (NYSE:XLE), which includes U.S. oil majors ExxonMobil Corp (NYSE:XOM) and Chevron Corp (NYSE:CVX), ticked higher as the brighter outlook for demand recovery buoyed optimism over corporate earnings. On the upstream side, the SPDR S&P Oil & Gas Exploration & Production ETF (NYSE:XOP) and the VanEck Oil Services ETF (NYSE:OIH) both gained more than 1% on the improved sentiment for producers and service companies, especially as disruptions to Russian supply stand to tighten global refined product markets further. Also Read: Meta, Marathon Petroleum, Exxon Mobil And An Industrial Stock On CNBC’s ‘Final Trades’ Rebounding Oil Sentiment Progress in the U.S. Senate toward reopening the government restored some appetite for risk across markets. The Reuters report cited analysts saying that a resolution could stabilize air travel and energy logistics— two sectors hit hard during the shutdown. Traders also expect pent-up fuel demand to surface as federal agencies resume normal operations, a trend that could lend short-term support to crude-linked ETFs. Geopolitical Tailwinds In the meantime, the ongoing rise in disruptions in Russia is giving oil markets extra support: drone attacks forced a shutdown of the Black Sea refinery Tuapse, and sanctions are still complicating exports from Lukoil. These events, along with OPEC+’s cautious stance on output increases, also help address concerns about rising inventories worldwide. Investor Takeaway For investors in ETFs, this is a conflicted setup–part optimism, part caution. Geopolitical supply risks and U.S. policy relief could sustain near-term gains for the USO, UCO, and XLE funds. Still, the persistent build-up in crude inventories and rising floating storage in Asia indicate that volatility is far from over. For now, energy ETFs are regaining attention as tactical plays in a market testing both supply limits and investor patience. Read Next: Google, Microsoft, Meta May Keep Powering AI ETFs As BlackRock CIO Calls Bubble Fears Overblown Photo: Shutterstock
