S&P 500 / Oil
Selected range · January 1960 — June 2026
About this chart
The S&P 500-to-Oil Ratio compares the level of the U.S. stock market with the price of crude oil.
The numerator is the monthly S&P 500 index level. The denominator is the World Bank’s monthly average crude-oil price, measured in U.S. dollars per barrel.
The oil series combines three major international benchmarks: Brent, Dubai Fateh, and West Texas Intermediate. It is therefore a broad reference price rather than the price of one specific grade of crude oil.
The ratio provides a long-term comparison between large U.S. public companies and one of the world economy’s most important energy commodities.
The ratio rises when the S&P 500 increases faster than oil prices. It can also rise when oil prices decline while the stock market remains stable or falls more slowly.
A higher ratio means that U.S. equities are relatively strong compared with crude oil. This may occur during periods of strong corporate earnings, expanding equity valuations, weak oil demand, abundant oil supply, increasing energy efficiency, or falling energy prices.
The ratio falls when oil prices rise faster than the S&P 500 or when equities weaken relative to oil.
A lower ratio means that crude oil is relatively strong compared with U.S. equities. This may occur during energy-supply disruptions, geopolitical tensions, strong global demand, inflationary periods, or weaker equity markets.
The S&P 500 component is an index level rather than the total dollar value of the U.S. stock market. The oil component is a price per barrel rather than the value of an investable oil portfolio.
The absolute ratio therefore does not measure how many barrels of oil can literally be purchased with the S&P 500. Its main purpose is to show how the historical relationship between the two series has changed.
The chart compares the S&P 500-to-Oil Ratio with its arithmetic historical average.
A reading above the historical average means that the S&P 500 index is relatively elevated compared with oil prices versus the full historical sample.
A reading below the historical average means that oil prices are relatively elevated compared with the S&P 500 index.
The deviation line expresses how far the ratio is above or below its historical average as a percentage.
A deviation of 0% means that the ratio is equal to its historical average.
A positive deviation means that the S&P 500 is relatively stronger than oil compared with the historical average.
A negative deviation means that oil is relatively stronger than the S&P 500 compared with the historical average.
The standard-deviation zones show whether the current relationship is relatively common or historically unusual. Values farther above or below 0% represent less common historical relationships between U.S. equities and crude oil.
The ratio can provide long-term context about equity-market cycles, energy-price shocks, inflation, and changing economic conditions. It should not be interpreted as a direct valuation measure, a total-return comparison, or a market-timing signal.
Limitations
- The model compares the S&P 500 index level with a crude-oil price per barrel, so it is a relative historical indicator rather than a comparison of directly equivalent asset values.
- The S&P 500 input excludes reinvested dividends, while the oil series excludes futures-roll returns, collateral returns, storage costs, transaction costs, and investment-product fees.
- The World Bank oil series is an average of Brent, Dubai Fateh, and West Texas Intermediate rather than one specific crude benchmark.
- Oil prices can be heavily influenced by supply decisions, geopolitical events, inventories, transportation constraints, exchange rates, and temporary demand shocks.
- The full-sample historical average and standard-deviation zones are retrospective and depend on the selected sample period.
- Structural changes in energy production, technology, regulation, inflation, and the composition of the S&P 500 may alter the relationship over time.
- An unusually high or low reading can persist and should not be interpreted as a precise valuation estimate or a market-timing signal.
Methodology
The S&P 500-to-Oil Ratio is calculated by dividing the monthly S&P 500 index level by the monthly World Bank average crude-oil price in U.S. dollars per barrel.
The oil input is the World Bank’s Crude Oil, Average series. It is the unweighted average of Brent, Dubai Fateh, and West Texas Intermediate crude-oil prices and is expressed in U.S. dollars per barrel. The model calculates the arithmetic historical average of the complete monthly S&P 500-to-Oil Ratio series. The percentage deviation measures how far each ratio observation is above or below that historical average. The standard deviation of the full historical percentage-deviation series is used to create the ±1σ, ±2σ and ±3σ zones around 0%. The z-score divides the current percentage deviation by that standard deviation, expressing the current relationship in standardized historical units. The model uses monthly observations beginning in January 1960 and continues through June 2026 in the current workbook.
Data sources
Monthly U.S. stock-market index level used as the equity component of the ratio
Range: January 1960 to the latest available observation used by the model
Source: DataHub, Standard and Poor’s 500 Index Data; https://datahub.io/core/s-and-p-500
Monthly average crude-oil price in U.S. dollars per barrel
Range: January 1960 to the latest available observation used by the model
Source: World Bank, Commodity Markets — World Bank Commodities Price Data, “The Pink Sheet”; https://www.worldbank.org/en/research/commodity-markets