Buy This ETF if You Want to Benefit From High Oil Prices Without Wild Swings

WTI crude went from $57.97 a barrel in December 2025 to over $100 today. That kind of move hands a windfall to oil producers and gives their shareholders motion sickness in roughly equal measure. If you wanted to participate in the oil rally without the queasy ride, you had to think one step downstream from the drilling rig.

Midstream is the toll booth of the energy business. The companies that own pipelines, storage tanks, and gas processing plants charge a fee per barrel and per cubic foot moved through their systems, and those fees are largely set by long-term contracts. They get paid whether crude is at $40 or $120. The barrels still have to go somewhere.

The Job UMI Is Hired To Do

The USCF Midstream Energy Income Fund (NYSEARCA:UMI) is an actively managed ETF run by sub-adviser Miller/Howard Investments that holds 20-25 high-quality midstream energy companies. Top positions read like a who’s who of North American hydrocarbon plumbing, including Enterprise Products Partners, Energy Transfer, and Williams Companies. UMI also packages MLP exposure in an ETF wrapper, so investors avoid the K-1 tax forms that come with owning the partnerships directly.

The return engine is volume and yield. Midstream firms “generate revenue from long-term, fee-based contracts for transporting oil and gas, making their cash flow more predictable.” The fund kicks that cash back to holders. UMI yields roughly 3.7% annually, paid monthly. The expense ratio sits at 0.69%, on the higher side for an ETF, which is what active management costs.

Does It Actually Smooth The Ride

Mostly, yes, and that smoothing has a price. Over the past year UMI returned 25%, while the Energy Select Sector SPDR ETF (NYSEARCA:XLE | XLE Price Prediction), which leans heavily on Exxon (NYSE:XOM), Chevron (NYSE:CVX), and other producers, returned 47% over the same window. You captured roughly half the rally. That is the deal you signed up for. The pipelines didn’t double their revenue when crude spiked, because their contracts didn’t change.

Stretch the lens out and the gap closes. Over five years UMI has returned 181% against XLE’s 187%. Through a full commodity cycle, the toll booth and the wildcatter ended up in nearly the same place, with very different paths to get there. UMI is up 21% year to date through April, and the shares now trade around $60.

One caveat. A 2023 Seeking Alpha analysis argued UMI had underperformed passive midstream alternatives like AMLP in its early years, and the question of whether active stockpicking adds enough alpha to justify the fee is fair to ask of any actively managed sleeve.

What You Are Giving Up

Three honest tradeoffs come with this strategy.

1. Capped upside when oil rips. If WTI heads to $120, the producers in XLE will run circles around midstream. Pipeline tariffs don’t reprice with the spot market, so UMI captures the second-derivative benefit (more drilling, more throughput) rather than the direct one.
2. Lumpy distributions. Monthly payouts vary wildly. UMI paid $0.1765 in March 2026 and $1.2165 in December 2025. The headline yield is real, but the cadence isn’t a steady paycheck. Retirees building a budget around it should average across the year.
3. Active management overhead. The 0.69% expense ratio is a meaningful drag versus passive midstream ETFs charging closer to half that. The manager has to earn it through stock selection.

UMI fits best as an energy income sleeve for investors who want exposure to fossil fuel demand through throughput rather than barrel prices. They’ll watch upstream producers run faster when crude really moves, and the monthly checks won’t all be the same size.