Oil ETF (USO) vs S&P 500
USO trades at $150.63 against SPY at $712 on April 30, 2026, with WTI crude oil at $95.85. USO has delivered a 125.87 percent 1-year return as the Iran war drove WTI from $73 to $95.85, while SPY returned approximately 8 percent over the same window.
Also known as: Oil ETF (USO) (ETF_USO, oil ETF) · S&P 500 ETF (SPY) (ETF_SPY, S&P 500, SPX, SP500)
Why This Comparison Matters
USO trades at $150.63 against SPY at $712 on April 30, 2026, with WTI crude oil at $95.85. USO has delivered a 125.87 percent 1-year return as the Iran war drove WTI from $73 to $95.85, while SPY returned approximately 8 percent over the same window. But the 24-month picture is the cautionary tale: USO at $150.63 today is below where it sat in mid-2008 when WTI peaked at $147, despite WTI now being at $95.85. The pair captures one of the most common retail mistakes in commodity investing: USO is a futures-rolling ETF that suffers persistent contango drag, making it an effective short-term oil-exposure trade but a structurally poor long-term hold against a passive equity index.
The April 2026 Snapshot: USO $150.63, SPY $712, WTI $95.85
USO closed at $150.63 on April 30, 2026, with NAV at $139.67. SPY traded at $712 near record highs. WTI crude oil sat at $95.85 per barrel, up from approximately $73 at the start of 2026 before the late-February Iran war outbreak.
USO has been the standout performer year-to-date, returning roughly +47 percent since January 2026 versus SPY at -2 percent over the same window. The 1-year return is +125.87 percent versus SPY at approximately +8 percent. But this single-window outperformance is heavily distorted by the Iran-war oil shock that began on February 25, 2026. Removing the Iran-related window (February 25 to present), USO would be down roughly 10 percent over the prior 12 months while SPY would be up 18 percent. The pair is a textbook example of why path matters in commodity-equity comparisons.
Why USO Is Not WTI: The Roll Mechanics
Investors often assume USO tracks WTI spot prices, but the fund actually holds front-month and second-month WTI futures contracts and rolls them forward each month. As of mid-March 2026, USO held primarily May 2026 WTI futures. On approximately the 14th business day of each month, USO sells the expiring front-month contract and buys the next contract.
This monthly rolling is the source of USO's structural performance drag. When the WTI futures curve is in contango (later contracts priced higher than nearer contracts), USO sells lower-priced expiring contracts and buys higher-priced new contracts every month, locking in a small loss per roll. Annualized, this contango drag has averaged 5 to 8 percent per year during the 2010s when WTI futures were typically in 1 to 3 percent monthly contango. During acute contango episodes (2009 and 2020), the annualized drag has exceeded 20 percent.
The Contango Drag: Why USO Underperforms WTI Spot
WTI spot has traveled a roughly flat path from January 2010 ($83) to April 2026 ($95), a 14 percent gain over 16 years, or approximately 0.8 percent annualized. Over the same period, USO has lost approximately 30 percent on a price basis. The 44 percentage point gap (44 over 16 years equals roughly 2.7 percent annualized) is the cumulative contango drag.
The physics: oil storage costs money. Tank rentals, insurance, and capital tied up in inventory all impose carry costs on physical oil. The futures market reflects this carry cost through contango: distant-month contracts price the cost of storing oil from now until then. When USO is long futures and rolls them month-to-month, it pays this carry cost continuously. Holders of physical oil (refiners, commercial traders) receive the equivalent carry as compensation for storage. USO holders pay it. Over multi-year periods, contango drag has consumed virtually all of WTI's spot appreciation. This is why USO is often described as "a trade, not an investment" in commodity-trader circles.
Conditional Forward Response (Tail Events)
How S&P 500 ETF (SPY) has historically behaved in the 5 sessions following a top-decile or bottom-decile daily move in Oil ETF (USO). Computed from 1,286 aligned daily observations ending .
Following these triggers, S&P 500 ETF (SPY) rises 0.03% on average over the next 5 sessions, versus an unconditional baseline of +0.23%. 129 qualifying events; S&P 500 ETF (SPY) closed positive in 51% of them.
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Frequently Asked Questions
What is the USO/SPY ratio on April 30, 2026?+
USO closed at $150.63 against SPY at approximately $712, producing a ratio of 0.21. Year-to-date 2026, USO has returned roughly +47 percent while SPY returned -2 percent, an unusual divergence driven by the late-February Iran war outbreak. Over a 1-year window, USO is +125.87 percent versus SPY at approximately +8 percent. The 1-year and YTD numbers are heavily distorted by a single supply shock; longer windows show the more typical pattern of SPY beating USO substantially.
Why does USO underperform WTI spot prices over multi-year periods?+
USO holds front-month and second-month WTI futures contracts and rolls them forward monthly. When the WTI futures curve is in contango (later contracts priced higher than nearer ones), USO sells expiring lower-priced contracts and buys new higher-priced contracts each month, locking in a small loss per roll. Annualized, this contango drag has averaged 5 to 8 percent per year during 2010s contango periods. From January 2010 to April 2026, WTI spot rose 14 percent while USO lost roughly 30 percent on price basis, a 44 percentage point gap representing accumulated roll drag.
What happened to USO during the April 2020 negative-oil episode?+
On April 20, 2020, WTI May 2020 futures settled at minus $37.63 per barrel, the first negative oil price ever. USO was holding a concentrated front-month position and faced potential physical-delivery obligations. USCF restructured the fund's portfolio over April and May 2020, taking permanent losses near the negative-oil settlement, then diversified across May, June, July, August, September, December, and June 2021 contracts. USO took a 1-for-8 reverse split on April 28, 2020. The post-restructuring fund is a less precise WTI tracker but more resilient to repeat front-month delivery crises.
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