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Energy sector surging to start 2022

Yahoo Finance's Jared Blikre discusses how the oil market performed this week.

Video transcript

KARINA MITCHELL: Welcome back to Yahoo Finance. Well, energy having another good day overall but oil is dealing with continued outages in Libya, adding to supply issues. Here with more is our Yahoo Finance's Jared Blikre. And Jared, crude oil-- crude oil down for the day but overall a good start to the year.

JARED BLIKRE: Yes, it is. And especially for the energy sector. I'll get to crude oil in a second. But I want to check out the YFi Interactive. We are looking at totals for 2021, this one week of trading, 10% for the energy sector. We haven't seen a bigger week since before the-- actually, I think we'd have to go back to November of 2020 but quite some time.

You can see ExxonMobil in the upper left, that's up almost 13%, Royal Dutch Shell up 9%, British Petroleum up 11%. And some of the smaller yet medium-sized names, we'll call them that, Occidental Petroleum up let's see, how much this week, it is an outperformer up 14%.

And I want to spend some time looking at XLE itself, that is the energy sector ETF because it is breaking through some huge, huge levels right here. Here's a max chart going back about 20 years to its inception. And it just broke out of this negative trend line a few weeks ago, and that has been a positive technical catalyst for it to breach what is a very important level here. That would be the $60 price level.

Now, you can see it's at $61.36 right now but here is a number of times historically that it got stuck in one way or another at this price level, here is a one, two, we'll call that two, three, four. So many times on this very long-term chart when we see moves like this they tend to consolidate after breaking out but we are seeing the extension now of the momentum that has carried it thus far. So I would expect more in the year to come for energy just based on this technical setup here.

I promised we'd get to crude oil, WTI crude futures for February settlement came in at $78.90 per barrel. Let's see if I can find my crude oil ticker on here, not popping up-- there we go. It looks like we're sitting on gains of 4% for the week. As you said, Karina, we are down about 0.5% for the day but also looking constructive in terms of crude oil. Here's a three-month chart and you can see we are now past the halfway point of that dramatic sell-off that we saw at the end of the prior year.