Energy Stocks Surge Past Tech Companies Amid Escalating US-Iran Conflict

Energy stocks are beating technology names this year, making energy the best-performing sector on Wall Street. That is happening even as the ongoing AI boom continues to drive strong gains across the US economy.

The S&P 500 energy sector has jumped 44.46% this year, compared to a 23% gain for information technology. Among the tracking funds, the State Street Energy Select Sector Fund (NYSE:XLE)/a> is up 40%, while the State Street Technology Sector Fund (NYSE:XLK)/a> has gained 28%./p> figure class="wp-block-image size-large">img loading="lazy" decoding="async" width="1024" height="567" src="https://editorial-assets.benzinga.com/wp-content/uploads/2026/09/13153449/XLE_2026-09-13_22-34-40-1024x567.png" alt="" class="wp-image-1641660" srcset="https://editorial-assets.benzinga.com/wp-content/uploads/2026/09/13153449/XLE_2026-09-13_22-34-40-1024x567.png 1024w, https://editorial-assets.benzinga.com/wp-content/uploads/2026/09/13153449/XLE_2026-09-13_22-34-40-300x166.png 300w, https://editorial-assets.benzinga.com/wp-content/uploads/2026/09/13153449/XLE_2026-09-13_22-34-40-768x425.png 768w, https://editorial-assets.benzinga.com/wp-content/uploads/2026/09/13153449/XLE_2026-09-13_22-34-40-1536x851.png 1536w, https://editorial-assets.benzinga.com/wp-content/uploads/2026/09/13153449/XLE_2026-09-13_22-34-40-2048x1134.png 2048w" sizes="(max-width: 1024px) 100vw, 1024px" />

XLE vs XLK year-to-date performance | Source: TradingView

Most of the gains in the energy sector have been driven by the oil, gas, and consumable fuels sub-sector, which has jumped by 45%. Energy and equipment segment has risen by 36% this year.

The energy sector has done well because of the ongoing US-Iran war, which is showing signs of extending. Ansar Allah, commonly known as Houthis, have taken a large part of Yemen, while the Iraqi resistance launched missiles towards the East-West pipeline, pushing the country to close it. /p> div class="bz-read-next-block" data-variant="list" data-news-mode="manual" >

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President Donald Trump has also suggested that the US-Iran war will end after the midterm elections. That means that the blockade will remain and the supply from Saudi Arabia will continue dwindling.

These events have pushed the average gasoline price to $4.31 and diesel to a record high of over $6. As a result, top oil and gas companies reported strong earnings and this trend may continue as energy prices remain at an elevated level.

ExxonMobil (NYSE:XOM)/a> reported $14.5 billion in earnings, more than double what it made last year. Chevron (NYSE:CVX)/a> made $12.1 billion, while Shell and Marathon Petroleum made $9.8 billion and $5.1 billion, respectively.

On the other hand, the S&P 500 Information Technology Sector has risen by 23% this year. A look at its subsectors shows that communication equipment rose by 44% this year, and is followed by semiconductor and equipment, which rose by 36%. Software and IT services are the top laggards, dropping by 0.94% and 21%, respectively.

Indeed, technology companies are among the best performers in the S&P 500 Index this year. This includes companies like SanDisk, Marvell Technology, Dell, Micron, Seagate, and Intel./p> div class="bz-read-next-block" data-variant="list" data-news-mode="manual" >

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