If you are deciding whether to add a dedicated sector bet at all, start with our ETFs and index funds hub.
Best Energy ETFs Listed on the TSX
Broad Energy ETFs
| ETF |
Ticker |
MER |
Yield |
Holdings |
Distribution |
Focus |
| iShares S&P/TSX Capped Energy |
XEG |
0.61% |
~3.5% |
30+ |
Monthly |
Canadian energy producers |
| BMO Equal Weight Oil & Gas |
ZEO |
0.61% |
~4.0% |
12 |
Quarterly |
Equal-weight Canadian energy |
| Horizons S&P/TSX Capped Energy |
HXE |
0.30% |
0% |
30+ |
None (total return swap) |
Tax-efficient energy exposure |
Pipeline & Midstream ETFs
| ETF |
Ticker |
MER |
Yield |
Holdings |
Distribution |
Focus |
| BMO Equal Weight Oil & Gas |
ZEO |
0.61% |
~4.0% |
12 |
Quarterly |
Includes pipeline stocks |
| Harvest Energy Leaders Plus |
HPF |
0.90% |
~7.5% |
20 |
Monthly |
Energy + covered calls for income |
| Hamilton Enhanced Energy |
HENS |
0.65% |
~7.0% |
15 |
Monthly |
1.25x leveraged Canadian energy |
US-Listed Energy ETFs
| ETF |
Ticker |
MER |
Yield |
Holdings |
Focus |
| Energy Select Sector SPDR |
XLE |
0.09% |
~3.5% |
23 |
S&P 500 energy |
| Vanguard Energy |
VDE |
0.10% |
~3.0% |
110+ |
Broad US energy |
| SPDR S&P Oil & Gas Exploration |
XOP |
0.35% |
~2.5% |
55+ |
Equal-weight US E&P |
| Alerian MLP ETF |
AMLP |
0.85% |
~7.0% |
15 |
US pipeline MLPs |
| iShares Global Energy |
IXC |
0.40% |
~4.0% |
50+ |
Global energy |
Top Holdings in Canadian Energy ETFs
XEG (iShares S&P/TSX Capped Energy)
| Company |
Ticker |
Weight |
Sub-Sector |
Dividend Yield |
| Canadian Natural Resources |
CNQ |
~20% |
Oil & gas producer |
~4.0% |
| Suncor Energy |
SU |
~15% |
Integrated oil sands |
~4.0% |
| Cenovus Energy |
CVE |
~12% |
Oil sands producer |
~2.5% |
| Imperial Oil |
IMO |
~8% |
Integrated (Exxon subsidiary) |
~2.0% |
| Tourmaline Oil |
TOU |
~8% |
Natural gas producer |
~5.0% |
| ARC Resources |
ARX |
~5% |
Natural gas + condensate |
~3.5% |
| MEG Energy |
MEG |
~4% |
Oil sands |
0% |
| Whitecap Resources |
WCP |
~3% |
Light oil producer |
~6.0% |
| Vermilion Energy |
VET |
~3% |
International E&P |
~2.0% |
| Precision Drilling |
PD |
~2% |
Drilling services |
~2.0% |
Major Canadian Pipeline Companies
| Company |
Ticker |
Market Cap |
Yield |
Business |
| Enbridge |
ENB |
$115B+ |
~6.5% |
Largest pipeline operator in North America |
| TC Energy |
TRP |
$65B+ |
~6.0% |
Natural gas pipelines, Keystone system |
| Pembina Pipeline |
PPL |
$30B+ |
~5.0% |
Western Canadian oil/gas pipelines |
| Keyera |
KEY |
$10B+ |
~5.5% |
Gas gathering and processing |
| Inter Pipeline |
N/A |
Acquired by Brookfield |
N/A |
Now part of BIP/BIPC |
Pipeline vs Producer Comparison
If you want the steadier, income-oriented cousin to these holdings, compare best infrastructure ETFs in Canada.
| Factor |
Pipelines (ENB, TRP, PPL) |
Producers (CNQ, SU, CVE) |
| Revenue model |
Toll/fee-based (volume-driven) |
Commodity price-driven |
| Oil price sensitivity |
Low |
Very high |
| Revenue stability |
High — long-term contracts |
Low — swings with oil prices |
| Dividend yield |
5–7% |
2–5% |
| Dividend stability |
Very stable, growing |
Can be cut in downturns |
| Growth potential |
Moderate (2–5% annually) |
High in upcycles, negative in downturns |
| Volatility |
Lower |
Higher |
| Best for |
Income investors, defensive |
Growth/value, oil price bulls |
| ETF |
1-Year |
3-Year (Annualized) |
5-Year (Annualized) |
Yield |
| XEG |
~10% |
~15% |
~12% |
~3.5% |
| ZEO |
~8% |
~14% |
~11% |
~4.0% |
| XLE (USD) |
~5% |
~18% |
~10% |
~3.5% |
| ENB (stock) |
~15% |
~8% |
~7% |
~6.5% |
Past performance does not guarantee future results. Energy returns are highly cyclical.
Oil Price Impact on Energy ETFs
| Oil Price (WTI) |
Impact on Producers |
Impact on Pipelines |
| <$50/barrel |
Unprofitable — stocks fall sharply |
Minimal — fee-based revenue |
| $50–70 |
Break-even to profitable |
Stable operations |
| $70–90 |
Strong free cash flow, dividends, buybacks |
Stable with volume growth |
| $90+ |
Windfall profits |
Marginal benefit from higher throughput |
Canadian Energy Sector Context
| Fact |
Detail |
| TSX energy weighting |
~17% of S&P/TSX Composite |
| Canada’s global rank |
4th largest oil producer (after US, Saudi Arabia, Russia) |
| Oil sands reserves |
3rd largest proven reserves globally |
| Natural gas |
Major LNG export capacity building |
| Carbon regulation |
Federal carbon tax, provincial regulations |
| Pipeline constraints |
Limited export capacity drives Canadian oil discount (WCS) |
| Energy transition |
Gradual shift but fossil fuels remain dominant for decades |
Risks of Energy ETF Investing
| Risk |
Detail |
| Oil price volatility |
Energy stocks closely track oil/gas prices |
| Commodity cycles |
Boom-bust cycles create significant drawdowns |
| Energy transition |
Long-term demand for fossil fuels uncertain |
| Carbon regulation |
Carbon taxes and emission caps add costs |
| Pipeline bottlenecks |
Limited export capacity keeps Canadian crude prices discounted |
| Geopolitical risk |
OPEC decisions, sanctions, conflicts affect oil prices |
| Sector concentration |
Already 17% of TSX — adding more increases concentration |
| ESG exclusion |
Many institutional investors divesting from fossil fuels |
That last point is why this page pairs naturally with best ESG ETFs in Canada.
Portfolio Integration
| Approach |
Energy Weight |
How |
| Market-weight (default) |
~17% via XIC |
No action needed — standard TSX exposure |
| Overweight energy |
20–25% |
Add XEG or ZEO alongside core ETF |
| Pipeline focus |
10–15% direct |
Buy ENB, TRP, PPL individually for yield |
| Underweight/ESG |
0–10% |
Use ESG-screened ETFs (XESG) or avoid sector |
| Global energy |
5–10% |
Add XLE or IXC for US/international exposure |
For the broader stock/bond decision before adding sector tilts, use asset allocation by age.