The focus has shifted from Egypt and now to Bahrain, and of course, Libya, which is changing the outlook for crude oil investors. You and millions of others might be wondering what Libya has to do with oil exchange traded funds (ETFs).
David Fessler for Investment U reports that Libya produces about 1.7 million barrels of oil per day, which accounts for about 2% of the world’s daily output, making Libya the world’s twelfth-largest oil supplier.
This would explain why U.S. Commodity Brent Oil Fund (NYSEArca: BNO) is attracting investors attention. The week before last, it was the best-performing oil ETF.
Although Libya doesn’t produce much of the oil we use, it’s still an important country when it comes to the oil supply. It’s also a major factor in why oil prices have been, and may continue to be, volatile. This may only become more pronounced as unrest trickles into other oil-rich countries in the Middle East.
If you’re looking to play rising oil prices and have the stomach for sharp swings, here are the best ETFs to play oil.
Positions of power in this region are all sensitive to the price of oil, and it will be a wit and see situation, but for now, the unrest could send prices spiking. Similar protests are already breaking out in other nearby countries, with Iran, Yemen and Lebanon growing increasingly restless.
Tisha Guerrero contributed this article.