Energy stocks saw a subpar performance in Q2 2023, with the sector turning in the second worst performance of all, showing a YTD return of -5.4%.
The big three refiners—Marathon Petroleum, Valero, and Phillips 66—recorded an average loss of 11% for the quarter, with Valero being the worst performer, declining 15.2% during the quarter.On June 30th the second quarter and first half of 2023 came to a close. The S&P 500 returned 8.3% for the quarter, but that performance was highly uneven. As in Q1, eight of 11 sectors underperformed the S&P 500 in Q2.
The median sector, as shown in the graphic below, was the Materials sector, which managed a 3.2% Q2 return. The energy sector, which I predicted would underperform this year, turned in the 2nd worst sector performance in Q2, and is also the second worst performer year-to-date. Only the Utilities sector and its -5.7% return was worse than the Energy sector’s -5.4% YTD return. — which I use to analyze companies — the average upstream company returned 0.5% in Q2.
Among the 46 companies that FactSet classifies as “midstream”, the average return was 1.2%. YTD the best among the group by far has been NGL Energy Partners, which generated a total first half return of 221.5%. That was also the best first half return of any energy company in any category.