2026 began with a dramatic upheaval in geopolitics. On Jan. 3, U.S. special operations forces executed a predawn military operation in Caracas that captured Venezuelan President Nicolás Maduro, flying him to New York to face federal drug-trafficking and terrorism charges.
President Donald Trump publicly framed the mission as part of a broader shift in U.S. foreign policy asserting American influence in the Western Hemisphere, commenting that the U.S. would “run” Venezuela through a transitional period.
The move came after months of U.S. military buildup in the Caribbean tied to what Washington billed as efforts to combat “narco-terrorism.” Previous actions included the seizure and interception of Venezuelan oil tankers and repeated strikes on vessels the U.S. said were linked to drug smuggling networks.
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But behind the stated security rationale, Venezuela’s vast oil reserves and strategic role in global energy markets make the country a key factor in how policymakers view the region’s future.
“Venezuela possesses a significant amount of oil reserves, but revitalizing production will take massive capital investment,” says Rob Thummel, managing director and senior portfolio manager at Tortoise Capital. “It will be years rather than months before we expect Venezuelan oil production to increase.”
Trump quickly convened meetings with major U.S. oil executives to encourage investment in rebuilding Venezuela’s energy infrastructure, but leaders such as ExxonMobil Corp. (ticker: XOM) CEO Darren Wood expressed skepticism about the investability of Venezuelan assets, given a history of expropriations.
“The major oil companies need political clarity and political stability before they will commit the capital needed to boost Venezuelan oil production,” Thummel explains. “For example, Chevron Corp. (CVX) is currently the only major oil producer operating in Venezuela today.”
That dynamic suggests fears of a sudden surge of Venezuelan oil hitting global markets may be overblown. Even so, the uncertainty has given investors a macro narrative to trade. In moments like this, sector exchange-traded funds (ETFs) can serve as one of the cleanest ways for retail to express top-down views on geopolitics, without having to pick individual energy stocks or trade commodity futures.
That dynamic showed up quickly in the data. According to ETF Central, U.S. energy ETFs took in a combined $493 million in net inflows on Jan. 6, followed by another $226 million the following day.
Here are seven of the best energy ETFs to buy in 2026:
| ETF | Expense ratio |
| Energy Select Sector SPDR Fund (XLE) | 0.08% |
| Vanguard Energy ETF (VDE) | 0.09% |
| Tortoise Energy Fund (TNGY) | 0.85% |
| VanEck Oil Refiners ETF (CRAK) | 0.62% |
| Tortoise MLP ETF (TMLP) | 0.50% |
| VanEck Oil Services ETF (OIH) | 0.35% |
| Simplify Kayne Anderson Energy and Infrastructure Credit ETF (KNRG) | 0.76% |
Energy Select Sector SPDR Fund (XLE)
“We prefer energy ETFs that are market-capitalization-weighted versus equal-weighted,” says Adam Grossman, global equity chief investment officer at RiverFront Investment Group. “We prefer this because we believe larger companies will have better access to capital and are more likely to have diversified businesses at the margin.” The largest energy ETF by assets, XLE, fits this profile.
XLE’s portfolio is limited to 22 large-cap energy stocks already included in the S&P 500. This ensures a baseline for size, liquidity and earnings consistency. The ETF is dominated by ExxonMobil and Chevron, at a combined weight of just over 40%. Over the past few years, State Street has reduced XLE’s expense ratio from 0.1% to 0.08%. The ETF currently pays a 3.1% 30-day SEC yield.
Vanguard Energy ETF (VDE)
The U.S. energy sector doesn’t end with S&P 500 companies. Investors can also target hundreds of small- and mid-cap players across the upstream, midstream and downstream segments. This can be achieved by allocating to VDE, which tracks the Spliced US Investable Market Energy 25/50 Index. Compared to XLE, VDE’s portfolio is much larger, at 107 companies. The ETF charges a similarly low 0.09% expense ratio.
However, VDE’s index methodology still uses market-cap weighting. This means investors can expect a similar level of concentration in the biggest energy stocks like ExxonMobil and Chevron, albeit to a smaller degree. For VDE, the combined weight of these two stocks is around 38%, slightly lower than XLE’s 40%. VDE currently pays a 3.1% 30-day SEC yield with quarterly distributions.
Tortoise Energy Fund (TNGY)
Passive index ETFs such as XLE and VDE are not the only way to gain exposure to U.S. energy stocks. Investors can also choose active management, which relies on the judgment of portfolio managers and research analysts to select companies they believe can outperform over a full market cycle. One example is TNGY, which is managed by Tortoise Capital, a firm with a long track record investing in real assets.
“We have an allocation to U.S. refiners in TNGY,” Thummel says. “Currently, most heavy oil comes from Canada, but with Venezuela as another potential future supply source, we expect heavy oil prices to remain low and potentially fall, which may boost the profits of U.S. refiners.” This stands in contrast to some energy ETFs that over-emphasize upstream exploration and production companies.
VanEck Oil Refiners ETF (CRAK)
“CRAK isolates the refining segment, an area of the energy sector value chain with its own distinct supply-and-demand dynamics, margin drivers and geopolitical sensitivities,” explains Andrew Musgraves, vice president and senior product manager at VanEck. The 30 companies in CRAK are responsible for refining crude oil into finished petroleum products such as gasoline, diesel and jet fuel.
CRAK can make sense for energy investors looking to express a more targeted thesis built around underinvestment in global refining capacity, against a rising demand for refined petroleum products. “These conditions could support elevated refining margins, especially for complex refiners with access to discounted or heavy crude supplies,” Musgraves explains. The ETF charges a 0.62% expense ratio.
[READ: 7 Best Natural Gas Stocks and Funds to Buy]
Tortoise MLP ETF (TMLP)
“The U.S. operates the largest pipeline network in the world,” Thummel explains. “Many of these companies are structured as master limited partnerships (MLPs) that offer investors high current income plus potential growth in distributions.” However, owning MLPs directly can be cumbersome because they are partnerships that issue schedule K-1 tax forms, which can complicate tax reporting.
For investors who want exposure without that added tax complexity, an ETF like TMLP can be a suitable alternative. “We believe this product is a smarter way to invest in MLPs,” Thummel says. “It’s a lower cost and tax-efficient way of getting exposure to the higher current income offered by leading energy infrastructure companies.” TMLP charges a 0.5% expense ratio and produces a 1099-DIV form for taxes.
VanEck Oil Services ETF (OIH)
“OIH captures the oil services segment, which sits upstream of refiners and producers and is directly leveraged to capital spending cycles across global energy markets,” Musgraves explains. “Holdings include firms specializing in drilling services, subsea equipment and well completion — which are all businesses that tend to benefit when energy companies commit capital to new projects.”
The bull case for OIH focuses on a perceived gap between years of underinvestment in oilfield services capacity, and a backdrop of rising resource nationalism and efforts by producers to scale output through higher capital spending. “In regions such as offshore Latin America and the U.S. Gulf Coast, new and revitalized projects are creating long-term demand for specialized oil and gas services,” Musgraves says.
Simplify Kayne Anderson Energy and Infrastructure Credit ETF (KNRG)
“KNRG’s goal is to exploit what we see as a persistent disconnect: You get paid more to lend to energy companies, despite the fact that they have better fundamentals than companies with similar ratings in other industries,” explains Christopher T. Getter, managing director, portfolio manager and emerging market strategist at Simplify Asset Management. Unlike the previous ETFs, KNRG does not hold stocks.
Instead, KNRG functions as an energy sector-specific corporate bond ETF, delivering a 5.8% 30-day SEC yield with monthly distributions and lower volatility. “We take a wide mandate with respect to ratings, including investment-grade and high-yield bonds, and security types, from plain vanilla bonds to hybrid-preferreds and even convertibles,” Getter explains. KNRG charges a 0.76% expense ratio.
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7 Best Energy ETFs to Buy Now originally appeared on usnews.com
Update 01/16/26: This story was published at an earlier date and has been updated with new information.
