Megaphone icon ETF Database is now VettaFi. Read More >
ETFdb Logo
ETFdb Logo
  • Channels
    • Active ETF
    • Alternatives
    • Beyond Basic Beta
    • China Insights
    • Climate Insights
    • Commodities
    • Core Strategies
    • Crypto
    • Disruptive Technology
    • Dividend
    • Dual Impact
    • Emerging Markets
    • Energy Infrastructure
    • Entrepreneur ETF
    • Equity ETF
    • ESG
    • ETF Building Blocks
    • ETF Education
    • ETF Strategist
    • Fixed Income
    • Future ETFs
    • Gold & Silver Investing
    • Innovative ETFs
    • Institutional Income Strategies
    • Leveraged & Inverse
    • Managed Futures
    • Modern Alpha
    • Multi-Asset
    • Multi-Factor
    • Nasdaq Investment Intelligence
    • Portfolio Strategies
    • Retirement Income
    • Smart Beta
    • Thematic Investing
    • Volatility Resource
  • Database
  • Tools
    • ETF Screener
    • ETF Country Exposure Tool
    • ETF Sector Tracker Tool
    • ETF Database Categories
    • Head-To-Head ETF Comparison Tool
    • ETF Stock Exposure Tool
    • ETF Issuer Fund Flows
    • Indexes
    • Mutual Fund To ETF Converter
    • ETF Data for Journalists
    • ETF Nerds
  • Research
    • First Bitcoin ETF
    • ETF Education
    • Equity Investing
    • Dividend ETFs
    • Leveraged ETFs
    • Inverse ETFs
    • Top ETF Sectors
    • Top ETF Issuers
    • Top ETF Industries
  • Webcasts
    • ETFs Future-Forward 2021: An iShares Investing Symposium
    • Three Themes for 2021: An iShares & MSCI Investing Symposium
  • Themes
    • AI ETFs
    • Blockchain ETFs
    • See all Thematic Investing ETF themes
    • ESG Investing
    • Marijuana ETFs
  • Videos & Podcasts
    • ETF 360 Video Series
    • ETF Trends on Videos
    • ETF Trends on Podcasts
    • ETF Prime Podcast
  • PRO
    • Pro Content
    • Pro Tools
    • Advanced
    • FAQ
    • Pricing
    • Free Sign Up
    • Login
  1. Energy Infrastructure Channel
  2. As Inflation Soars, Midstream Is Well-Positioned
Energy Infrastructure Channel
Share

As Inflation Soars, Midstream Is Well-Positioned

Elle CarusoMar 10, 2022
2022-03-10

The Bureau of Labor Statistics’ Consumer Price Index (CPI) rose 7.9% in February compared to one year prior, marking the fastest annual jump since 1982, taking out January’s previous 40-year record high rate of 7.5%.

On a month-over-month basis, consumer price increases also accelerated. The CPI rose 0.8% in February after increasing by 0.6% during the prior month.

A key contributor to the latest CPI report is the recent surge in energy prices. The energy index jumped 3.5% in February, and over a one-year period, the energy index was up 25.6%.

Oil and gas prices were on the rise even before Russia invaded Ukraine and escalated concerns over global energy disruptions, as demand for oil and other energy sources surpassed current global supplies.

The CPI data in March is expected to show the further impact from the Russia-Ukraine crisis and extended jump in energy prices. Since the invasion in late February, and subsequent economic sanctions aimed at Russia, gas prices have jumped to record levels, and crude oil prices have climbed to 14-year highs and briefly topped $130 per barrel.

Investing in midstream/MLP has various advantages in inflationary periods. Energy infrastructure is well-positioned for the current inflationary environment, benefitting from its inherent real asset exposure and contract provisions that allow for annual inflation adjustments. For investors, dividend growth from the space can help offset the negative impact of inflation, according to Stacey Morris, CFA, director of research at Alerian.

Unlike stocks or bonds that derive value from a contractual right, real assets, such as precious metals, commodities, real estate, and infrastructure, derive their worth from the intrinsic value of a physical asset and can serve as an inflation hedge, according to Morris.

For midstream, these physical assets include pipelines, processing facilities, storage tanks, and export terminals. In addition to midstream’s real asset exposure, the space can also benefit from improving energy sentiment broadly as oil prices move higher in inflationary periods, Morris wrote.

Investors looking to bolster their portfolios with midstream exposure should consider the Alerian Energy Infrastructure ETF (ENFR ) and the Alerian MLP ETF (AMLP A).

For more news, information, and strategy, visit the Energy Infrastructure Channel.

Loading Articles...
Help & Info
  • Contact Us
  • Mission Statement
  • Press
Tools
  • ETF Screener
  • ETF Analyzer
  • Mutual Fund to ETF Converter
  • Head-To-Head ETF Comparison
  • ETF Country Exposure Tool
  • ETF Stock Exposure Tool
  • ETF Performance Visualizer
  • ETF Database Model Portfolios
  • ETF Database Realtime Ratings
  • ETF Database Pro
More Tools
  • ETF Launch Center
  • Financial Advisor & RIA Center
  • ETF Database RSS Feed
Explore ETFs
  • ETF News
  • ETF Picks of the Month
  • ETF Category Reports
  • Premium Articles
  • Alphabetical Listing of ETFs
  • Best ETFs
  • Browse ETFs by ETF Database Category
  • Browse ETFs by Index
  • Browse ETFs by Issuer
  • Compare ETFs
Legal
  • Terms of Use and Privacy Policy
  • © ETF Flows LLC
Follow ETF Database
Follow ETF Database

Advertisement

Is Your Portfolio Positioned With Enough Global Exposure?

Equity ETF Channel

Retirement Portfolio Redux: Is the 60%-40% Portfolio Dead?

Debbie CarlsonOct 22, 2020
2020-10-22

With the 10-year U.S. Treasury yield hovering below 1% and Federal Reserve Chairman Jerome Powell...

Equity ETF Channel

Portfolio Diversification Isn't Dead, It Was Just Sleeping

Debbie CarlsonOct 15, 2020
2020-10-15

Investors could be forgiven to think there was no reason to invest outside of the U.S. for the...

}
X