This paper investigates the axisymmetric instability of a viscoelastic compound jet, for which the constitutive relation is described by the Oldroyd B model. It is found that a viscoelastic compound jet is more unstable than a Newtonian compound jet, regardless of whether the viscoelastic compound jet is inner-Newtonian-outer-viscoelastic, inner-viscoelastic-outer-Newtonian, or fully viscoelastic. It is also found that an increase in the stress relaxation time of the inner or outer fluid renders the jet more unstable, while an increase in the time constant ratio makes the jet less unstable. An analysis of the energy budget of the destabilization process is performed, in which a formulation using the relative rate of change of energy is adopted. The formulation is observed to provide a quantitative analysis of the contribution of each physical factor (e.g., release of surface energy and viscous dissipation) to the temporal growth rate. The energy analysis reveals the mechanisms of various trends in the temporal growth rate, including not only how the growth rate changes with the parameters, but also how the growth rate changes with the wavenumber. The phenomenon of the dispersion relation presenting two local maxima, which occurred in previous research, is explained by the present energy analysis.