Energy Stocks Outperform Amid Natural Gas Boom

Key Points:

* Natural gas drives energy sector outperformance, boosting the S&P 500 Energy ETF (XLE) by over 7% year-to-date.
* Pipeline and midstream companies benefit from increased natural gas demand and infrastructure investments.
* Strong fourth-quarter results and capital discipline drive gains for oil and gas giants like ExxonMobil and Chevron.
* Devon Energy sees profits surge with record production and a dividend hike.
* Natural gas futures rally to two-year highs due to cold weather, LNG exports, and electricity demand.
* Oversupply concerns dampen oil price gains, as OPEC+ hints at production delays.

Individual Company Highlights:

* Plains All America Pipeline (PAA): Up 19% year-to-date.
* Baker Hughes (BKR): Up 13% after strong gas infrastructure orders.
* MPLX (MPLX): Up 12% year-to-date as a natural gas pipeline transportation company.
* ExxonMobil (XOM): Up 3% year-to-date.
* Chevron (CVX): Up 9% year-to-date.
* BP (BP): Up 17% year-to-date, refocusing on oil and gas.

Investor Sentiment:

* Investors flock to energy stocks for dividend hikes and share buyback promises.
* Capital discipline lowers production costs and boosts returns for producers.
* Oversupply concerns temper enthusiasm for oil, while natural gas remains bullish.