Brent crude oil has risen above $100 per barrel for the first time since July, driven by intensified attacks on tankers and energy infrastructure in the Middle East. West Texas Intermediate, the U.S. benchmark, has advanced toward $95. The conflict has escalated with the U.S. military sinking four Iranian tankers in the Gulf of Oman and destroying a fifth near Kharg Island after Tehran attempted to strike American warships. Separately, Iran-backed Houthi militants claimed attacks on Saudi Aramco’s 400,000-barrel-a-day Jazan refinery.

The State Street Energy Select Sector SPDR ETF (NYSE: XLE) is a primary beneficiary of these price movements. The fund closed Tuesday at $64.77, less than a dollar from its 52-week high. It added another 1.8% before Wednesday’s opening bell and gained 7.4% in August, leading all 11 Select Sector SPDR funds. U.S. oil and gas stocks have risen more than 40% since the beginning of 2026, outperforming the SPDR S&P 500 ETF Trust (NYSE: SPY), which is up roughly 12%.

Exxon Mobil Corp. (NYSE: XOM) and Chevron Corp. (NYSE: CVX) comprise approximately 36% of the XLE fund. Refiners are also seeing profitability improve due to widening margins between crude costs and fuel prices. The VanEck Oil Refiners ETF (NYSE: CRAK) closed at a record $64.79 on Tuesday and is up roughly 66% year to date. Its top holdings are Marathon Petroleum Corp. (NYSE: MPC) at 8.90%, Valero Energy Corp. (NYSE: VLO) at 7.57%, and Phillips 66 (NYSE: PSX) at 6.91%.

Conversely, the high cost of oil presents challenges for other sectors. Airlines face a margin squeeze as jet fuel represents roughly 25% to 30% of operating expenses. The U.S. Global Jets ETF (NYSE: JETS) slipped in premarket trading after losing more than 13% over the previous month. Delta Air Lines Inc. (NYSE: DAL) fell 13.9%, and United Airlines Holdings Inc. (NASDAQ: UAL) declined 16.8% during that period.

Expensive oil also contributes to inflationary pressures, which may influence Federal Reserve policy. Chair Kevin Warsh has signaled a need to tackle persistent price pressures through higher interest rates. The 10-year Treasury yield rose to about 4.78%, its highest since early 2025. This environment impacts the State Street Real Estate Select Sector SPDR ETF (NYSE: XLRE) by making bonds more competitive with property income and increasing borrowing costs. Additionally, higher interest rates can make gold less attractive relative to interest-bearing assets, potentially affecting the VanEck Gold Miners ETF (NYSE: GDX) and Newmont Corp. (NYSE: NEM).