Last week's grand stampede out of

Procter & Gamble

(PG) - Get Report

made it clear enough who gets hurt when commodity prices spike. But who benefits from the other side of the trade is a lot more difficult to game.

It certainly hasn't been the commodities stocks.

Until P&G confessed that rising petroleum and pulp costs would take a considerable chunk out of its bottom line, the positive impact of oil's movement past $30 a barrel was largely confined to a handful of service stocks, including

Halliburton

(HAL) - Get Report

and

Schlumberger

(SLB) - Get Report

.

And the bounces in paper products and integrated oil and gas stocks that followed the P&G warning have been negligible compared to the pasting those sectors have taken this year. The

American Stock Exchange Oil & Gas Index

is still down 6.8% since Jan. 1. The

Philadelphia Stock Exchange Forest & Paper Products Index

has stumbled a colossal 26.8%.

What Rally?

For the past year, the market has largely ignored a broad commodities rally -- most famously in crude oil, but also in such back-page goods as natural gas, palladium and pulp. The

Commodities Research Bureau

index is up 13% over the last 12 months. And

Merrill Lynch

quantitative strategist Rich Bernstein points out in a recent note that, since their lows in late 1998, core material prices have accelerated at the fastest rate in 25 years -- prompting him to title the piece "The Biggest Bull Market in Commodities Since 1975?"

But as far as commodity stocks are concerned, Wall Street has been very reluctant to admit that prices can hold at these levels -- an ironic stance, given its simultaneous refusal to accept that P&G's slowdown is a cyclical aberration.

"Investors don't believe it can be sustained," says Kari Bayer, quantitative strategist at

Merrill Lynch

, of the recent strength in crude. "But they're neglecting to realize that last year, companies were reporting earnings on

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$12 a barrel, while this year, they're reporting on $30 a barrel. They're neglecting to think about where we were a year ago, and how that will impact profits."

Some industry analysts are grudgingly revising their 2000 estimates upward. But most are only going as high as the $24-to-$26 range, and thus relying on the same fundamental assumption they've been wrongly making since last spring, that crude prices are near their peak.

OPEC's

March 27 meeting in Vienna may make the plausibility of that thesis much clearer. But in the meantime, oil continues to hold the $30 level better than anyone thought possible.

The implication of this trend is simple. If crude estimates still have to go higher, so do earnings estimates for the integrated oil and gas stocks. "Earnings growth is clearly abundant," says Bayer, "And nobody's paying attention to it."

Pumped-Up Pulp

The same goes for pulp. The price of the stuff has risen some 30% from its nadir in February 1999, according to Lise Shonfield, industry analyst at

ABN Amro

. And producers are planing to hike prices again in April. "It's just demand over supply," Shonfield says. "Supply has been reasonably well-contained -- capital increases are lower than they've been for some time. And demand has been good. As a result, inventories have been coming down."

With global economies -- and demand -- generally on the upswing, Shonfield thinks that current pulp prices are sustainable. A number of companies seem to agree.

This week, the specialty-chemicals concern

Hercules

(HPC)

set plans to raise prices for its paper goods by 5% worldwide -- a move already made by

Kimberly-Clark

(KMB) - Get Report

,

Fort James

and, yes, Procter & Gamble.

Still, most market participants are not about to bet on commodities stocks in the current climate.

"Not until you see the money flow turn positive and a change in the interest-rate environment," says Tony Dwyer, chief market strategist at

Kirlin Holdings

. "There are going to be oversold rallies, but they're going to be used as opportunities to sell into, not opportunities to accumulate."

The choppy performance in oil and paper stocks last week suggests that market sentiment remains unfavorable. And little wonder. There's nothing on the economic front to suggest that the

Fed

is nearing the end of its rate-hiking cycle. More in doubt may be the future dynamic of mutual fund flows, which have, thus far, remained tenaciously focused on technology and growth stocks.

It's safe to say that the longer commodities prices hold these levels, the better the chance that dynamic could change.