Are mega caps the best way to play a higher oil price?

Tensions in Iraq prompted a spike in the oil price last month, but UK equity managers are torn over whether ‘supermajors' BP and Shell are the best way to play rising prices.

A volatile situation erupted in Iraq in June as the militant group ISIS took over major cities, forcing the country to declare a state of emergency.  Notably, the group attacked Iraq’s major oil refinery in Baiji, which provides almost a quarter of the refining capacity of the world’s seventh-largest oil producer.  As a result, the price of Brent crude oil spiked to $115 per barrel, a nine-month high and an increase of 5% since ISIS declared parts of Iraq a new Islamic state. The oil price has since dropped back to $110, but the Iraq tension is the latest in a series of issues for ...