Best Oil ETFs for 2026
Oil ETFs offer investors various ways to gain exposure to crude oil prices and energy sector equities. From funds that track oil futures contracts to those that hold shares of oil producers and explorers, the category spans a wide range of strategies with very different risk-return profiles. Understanding the difference between commodity-based and equity-based oil ETFs is essential before investing in this space.
USO, the United States Oil Fund, is the most well-known oil commodity ETF, tracking the price of West Texas Intermediate (WTI) crude oil through futures contracts. BNO, the United States Brent Oil Fund, provides similar exposure but tracks Brent crude, which is the international benchmark and tends to trade at a slight premium to WTI. For equity-based oil exposure, XLE, the Energy Select Sector SPDR Fund, holds major energy companies like ExxonMobil, Chevron, and ConocoPhillips, offering indirect oil exposure along with the benefits of corporate earnings, dividends, and operational diversification.
Oil prices are influenced by a complex web of factors including OPEC production decisions, global economic growth, geopolitical tensions, inventory levels, and the energy transition away from fossil fuels. Commodity-based oil ETFs face the additional challenge of contango — a condition where futures contracts cost more than spot prices — which can erode returns over time even if the spot price of oil rises. This makes holding period and strategy important considerations.
How We Rank
ETFs are ranked by assets under management (AUM). Only ETFs with $50M+ in assets are included. Data is updated daily.
| # | Symbol | Fund Name | AUM |
|---|---|---|---|
| 1 | EMLP | First Trust North American Energy Infrastructure Fund | $4.16B |
| 2 | XOP | State Street SPDR S&P Oil & Gas Exploration & Production ETF | $3.72B |
| 3 | HYXE | iShares iBoxx $ High Yield ex Oil & Gas Corporate Bond ETF | $2.49B |
| 4 | USO | United States Oil Fund, LP | $2.08B |
| 5 | OIH | VanEck Oil Services ETF | $1.93B |
| 6 | SCO | ProShares - UltraShort Bloomberg Crude Oil | $714.9M |
| 7 | BNO | United States Brent Oil Fund LP | $664.5M |
| 8 | IEO | iShares U.S. Oil & Gas Exploration & Production ETF | $595.0M |
| 9 | UWT | VelocityShares 3x Long Crude Oil ETNs linked to the S&P GSCI Crude Oil Index ER New | $480.4M |
| 10 | UCO | ProShares Ultra Bloomberg Crude Oil | $418.2M |
| 11 | PBOG | Portfolio Building Block Integrated Oil and Gas and Exploration and Production Index ETF | $416.9M |
| 12 | IEZ | iShares U.S. Oil Equipment & Services ETF | $392.5M |
| 13 | XES | State Street SPDR S&P Oil & Gas Equipment & Services ETF | $382.4M |
| 14 | USOI | UBS AG ETRACS Crude Oil Shares Covered Call ETNs due April 24, 2037 | $296.9M |
| 15 | DWT | VelocityShares 3x Inverse Crude Oil ETNs linked to the S&P GSCI Crude Oil Index ER New | $277.1M |
| 16 | CRAK | VanEck Oil Refiners ETF | $254.7M |
| 17 | DBO | Invesco DB Oil Fund | $250.0M |
| 18 | GUSH | Direxion Daily S&P Oil & Gas Exp. & Prod. Bull 2X ETF | $248.8M |
| 19 | OILK | ProShares - K-1 Free Crude Oil ETF | $229.2M |
| 20 | FTXN | First Trust Nasdaq Oil & Gas ETF | $160.0M |
| 21 | UGA | United States Gasoline Fund, LP | $135.9M |
| 22 | DRIP | Direxion Daily S&P Oil & Gas Exp. & Prod. Bear 2X ETF | $106.8M |
| 23 | DBE | Invesco DB Energy Fund | $104.6M |
| 24 | PXE | Invesco Energy Exploration & Production ETF | $83.0M |
| 25 | BWET | Breakwave Tanker Shipping ETF | $73.5M |
What to Look For
Distinguish between commodity-based oil ETFs (which use futures contracts) and equity-based energy ETFs (which hold oil company stocks). Commodity ETFs like USO face roll costs from contango that can significantly erode returns over time. Equity ETFs like XLE offer dividends and are not subject to futures roll costs but may not track oil prices as directly.
For commodity ETFs, check the fund's roll methodology and whether it uses front-month or longer-dated contracts. For equity ETFs, examine the concentration in top holdings and whether the fund includes integrated majors, exploration companies, or oil services firms.
Which Oil ETFs Is Best for You?
XLE is the most practical way for most investors to gain oil exposure. By holding the energy stocks in the S&P 500, XLE provides exposure to oil prices through company earnings while also paying dividends and avoiding the futures roll costs that plague commodity ETFs. Its heavy weighting in ExxonMobil and Chevron means it moves with oil prices but with less volatility.
USO offers the most direct exposure to WTI crude oil prices through futures contracts. It is best suited for short-term tactical trades rather than long-term holdings due to the drag from futures contango. Traders use USO to express views on oil price direction over days or weeks, but it is not ideal for buy-and-hold investors.
BNO tracks Brent crude oil futures and serves as an alternative to USO for investors who want international oil benchmark exposure. Brent tends to be more reflective of global oil supply-demand dynamics, while WTI is more influenced by US-specific factors. Like USO, BNO is best used as a tactical trading instrument.
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