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Investors Are Cozying Up to MLPs Despite Oil’s Bearish Streak

  • In yield-starved world, midstream is looking better: Jefferies
  • Since early June, crude down 13 percent, Alerian up 2 percent
Views Of Largest U.S. Oil Hub As Stockpile Growth Slows
Photographer: Daniel Acker/Bloomberg
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After falling from grace amid crude’s collapse, master-limited partnerships, a darling of recent commodities booms, are winning over investors again thanks to their high payouts and long-term contracts.

Investors are stashing money in the pipeline partnerships, which keep America’s shale oil and natural gas flowing to markets. They’re lured by earnings that have performed better than many had feared as well as the promise of higher yields at a time when global interest rates are floundering. Since June 1, crude slid another 13 percent amid fears of global oversupply. Meanwhile, the Alerian MLP Index, which tracks 44 MLPs including Enterprise Products Partners LP and Williams Partners LP, has gained 2 percent.