Violence in the Middle East has caused oil prices to climb to a 2 1/2 year high.
According to the Wall Street Journal, light, sweet crude oil for April delivery settled $2.66, or 2.7%, higher at $99.63 a barrel on the New York Mercantile Exchange. Brent crude oil on the ICE futures exchange gained $3.62, or 3.2%, to settle at $115.42 a barrel.
As the unrest in Libya threatens to turn into a civil war, traders are bidding up oil futures on the prospect of violence spreading to other oil producing states.
One way to gain exposure to oil prices with exchange traded funds is through the SPDR S&P Oil and Gas Exploration ETF (XOP). The $1.4 billion ETF tracks an index that represents the oil and gas exploration and production sub-industry portion of the S&P Total Market Index. Top holdings include Frontier Oil Corp (FTO), Chesapeake Energy Corp (CHK), Holly Corp (HOC) and Tesoro Corp (TSO). The fund carries an expense ratio of 0.35% and a dividend yield of 0.23%.