Energy shares led the ASX 200 market sectors with a 3.19% gain last week.
Meantime, the S&P/ASX 200 Index (ASX: XJO) rose by just 0.2% to finish the week at 8,310.4 points.
Six of the 11 market sectors finished the week in the green.
Let's recap.
Image source: Getty Images
Energy shares led the ASX sectors last week
Energy shares have climbed at three times the pace of the ASX 200 in the new year.
The S&P/ASX 200 Energy Index (ASX: XEJ) has risen 4.07%, while the ASX 200 has lifted 1.33%.
ASX energy shares were beaten up in 2024, but it appears investors are reassessing their value now, particularly as commodity prices pick up.
According to Trading Economics, Brent crude oil futures have lifted by about 9.5% in the year to date (YTD).
On Friday, Brent was trading at a five-month high of about US$81.80 per barrel.
WTI futures have also climbed by more than 10% YTD to a five-month high above US$79.30 per barrel on Friday.
Trading Economics analysts said the Gaza ceasefire agreement had reduced the geopolitical risk premium on oil prices.
They added:
Still, the oil market continues to find support on concerns about the impact of US sanctions on Russian energy flows, declining US stockpiles, and winter heating fuel demand.
Additionally, expectations of additional rate cuts by the Federal Reserve could stimulate economic activity, which in turn may drive up energy demand.
As [US president-elect Donald] Trump's inauguration approaches, traders are bracing for possible policy shifts, such as tariffs on Canadian oil and measures to boost US production.
US natural gas prices have also surged in the YTD.
The US natural gas price reached a two-year high of US$4.30 per metric million British thermal unit (MMBtu) last week.
Trading Economics analysts said the natural gas price surged due to predictions of severe winter weather.
The forecast is expected to push demand across America to unprecedented levels.
Last week, the major ASX 200 oil shares, with the exception of Woodside Energy Group Ltd (ASX: WDS), jumped in value.
The Santos Ltd (ASX: STO) share price rose by 3.13% over the week to finish at $7.25 on Friday.
Beach Energy Ltd (ASX: BPT) shares ascended 3.82% to $1.50 apiece.
The Karoon Energy Ltd (ASX: KAR) share price climbed by 2.61% to $1.50 apiece.
Ampol Ltd (ASX: ALD) shares were 2.77% higher at $29.68 apiece.
Viva Energy Group Ltd (ASX: VEA) shares increased 4.71% to $2.78.
Woodside shares fell 0.039% and closed at $25.75 apiece on Friday.
My colleague, Tristan Harrison, wrote about the outlook for Woodside shares in the new year on Friday.
ASX 200 market sector snapshot
Here's how the 11 market sectors stacked up last week, according to CommSec data.
Over the five trading days:
| S&P/ASX 200 market sector | Change last week |
| Energy (ASX: XEJ) | 3.19% |
| Materials (ASX: XMJ) | 2.63% |
| A-REIT (ASX: XPJ) | 1.66% |
| Utilities (ASX: XUJ) | 1.4% |
| Industrials (ASX: XNJ) | 0.59% |
| Consumer Staples (ASX: XSJ) | 0.35% |
| Communication (ASX: XTJ) | (0.57%) |
| Financials (ASX: XFJ) | (0.63%) |
| Consumer Discretionary (ASX: XDJ) | (1.17%) |
| Healthcare (ASX: XHJ) | (1.91%) |
| Information Technology (ASX: XIJ) | (3.12%) |
