Crude oil futures did not change a lot on Wednesday, June 18, as President Trump said Iran wanted to talk about its nuclear program after six days of Israeli airstrikes on Iran.
US crude oil futures went up by 0.4% while the global benchmark, Brent, rose 0.25%. On Tuesday, prices had jumped more than 4% as Trump demanded that Iran surrender unconditionally.
President Trump told reporters outside the White House that Iranian officials had contacted him and suggested sending a delegation to the White House for negotiations.
Since Israel started its campaign against Iran last Friday, oil prices have increased by about 10%.
Investors are focused on the Strait of Hormuz, a narrow waterway between Iran and Oman. This strait is very important because between 18 and 19 million barrels of crude oil and fuels pass through it per day. This is nearly one-fifth of the world’s consumption.
In 2024, about 85 million tons of liquefied natural gas (LNG) from Qatar and the United Arab Emirates also went through the Strait of Hormuz, making up around 20% of global demand. If maritime activity through the Strait of Hormuz is disrupted, it could cause serious problems for oil and gas markets and push prices much higher.
With this background in mind, let’s take a look at the 10 best oil and gas stocks to buy now.
Oil and gas engineers surveying an expansive landscape for producing oil fields.
Our Methodology
To compile our list of the 10 best oil and gas stocks to buy now, we used stock screeners from Finviz and Yahoo Finance to find the largest oil and gas companies. We sorted our results based on market capitalization and picked the 30 largest stocks. We also reviewed various financial media reports and online resources to compile a list of the best energy stocks to buy. Next, we focused on the top 10 stocks most favored by institutional investors. Data for the hedge fund sentiment surrounding each stock was taken from Insider Monkey’s Q1 2025 database of 1,000 elite hedge funds. Finally, the 10 best oil and gas stocks to buy now were ranked in ascending order based on the number of hedge funds holding stakes in them as of Q1 2025.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10 Best Oil and Gas Stocks to Buy Now
10. Occidental Petroleum Corporation (NYSE:OXY)
Number of Hedge Fund Holders: 59
Occidental Petroleum Corporation (NYSE:OXY) is one of the 10 best oil and gas stocks to buy now. On May 9, JPMorgan lowered its price target on Occidental Petroleum Corporation (NYSE:OXY) from $52 to $47 and kept a “Neutral” rating.
JPMorgan analysts highlighted the corporation’s Q1 2025 results and the management’s efforts to cut costs amid a challenging oil price environment.
Occidental Petroleum Corporation (NYSE:OXY) reported that it reduced drilling cycle times in the Permian Basin by 15% through enhanced well designs and strong execution. These actions led to a 10% decrease in well costs year-over-year, exceeding the target of 5-7% that the company had set just a few months ago.
Thanks to these improvements, the corporation plans to decommission two drilling rigs in the Permian in 2025. However, Occidental Petroleum Corporation (NYSE:OXY) aims to bring more wells online and with slightly increased production even with this reduced rig count.
The corporation has lowered its full-year capital guidance by $200 million. Additionally, Occidental Petroleum Corporation (NYSE:OXY) aims to cut its operational expenses by $150 million in 2025.
Occidental Petroleum Corporation (NYSE:OXY) is an American multinational energy company with assets mainly in the US, the Middle East, and North Africa. It is one of the largest oil and gas producers in the US.
9. EOG Resources, Inc. (NYSE:EOG)
Number of Hedge Fund Holders: 64
EOG Resources, Inc. (NYSE:EOG) is one of the 10 best oil and gas stocks to buy now. On June 13, Jefferies increased its price target on EOG Resources, Inc. (NYSE:EOG) from $144 to $148 while keeping a “Buy” rating.
This decision came after discussions with EOG Resources, Inc.’s (NYSE:EOG) Vice President and Head of Investor Relations Pearce Hammond. The talks focused on the company’s recent Encino acquisition and plans for development in the future.
Jefferies confirmed EOG Resources, Inc.’s (NYSE:EOG) earlier statement that the Encino acquisition would boost EBITDA and cash flow by 10%. However, the firm’s own analysis suggests that free cash flow could improve even more, especially after taking into account about $150 million in synergies and expected changes in production.
The higher price target is based on the assumption by Jefferies that the Encino acquisition will be completed in the third quarter of 2025. This deal is expected to provide EOG Resources, Inc. (NYSE:EOG) with more production assets and operational efficiencies.
EOG Resources, Inc. (NYSE:EOG) is one of the largest American crude oil and natural gas exploration and production companies with proven reserves in the US and Trinidad.
8. Kinder Morgan, Inc. (NYSE:KMI)
Number of Hedge Fund Holders: 65
Kinder Morgan, Inc. (NYSE:KMI) is one of the 10 best oil and gas stocks to buy now. On June 11, UBS maintained its “Buy” rating on Kinder Morgan, Inc. (NYSE:KMI) with a price target of $38. The research firm highlighted that the company will see a full quarter contribution from its Outrigger acquisition.
UBS slightly raised its estimate for Kinder Morgan, Inc.’s (NYSE:KMI) EBITDA for the second quarter of 2025. The firm’s new estimate is $1.932 billion, up from the previous $1.929 billion. This forecast is about 0.6% higher than the company’s own guidance of $1.92 billion. UBS pointed out that Kinder Morgan, Inc.’s (NYSE:KMI) guidance does not include any contribution from the Outrigger acquisition.
The new estimate takes into account the full-quarter impact of the acquisition, higher operating costs in the first quarter for natural gas pipelines due to timing issues, and benefits from higher natural gas prices.
The analysts believe that the first quarter did not show the full impact of the Outrigger acquisition. This was because transaction costs offset 1.5 months of contribution from Outrigger. UBS analysts noted that the second quarter will be “the first clean quarter” for evaluating the impact of the acquisition.
Kinder Morgan, Inc. (NYSE:KMI) is one of North America’s largest energy infrastructure companies. It owns and operates pipelines and terminals. The company’s pipelines transport natural gas, gasoline, and crude oil.
7. Schlumberger Limited (NYSE:SLB)
Number of Hedge Fund Holders: 68
Schlumberger Limited (NYSE:SLB) is one of the 10 best oil and gas stocks to buy now. On April 28, Stifel analysts lowered the price target for Schlumberger Limited (NYSE:SLB) from $58 to $54 but kept a “Buy” rating.
The firm highlighted the company’s solid performance in the first quarter of 2025 and a positive financial outlook for the year.
Stifel analysts also noted that Schlumberger Limited’s (NYSE:SLB) ability to generate strong free cash flow and commitment to returning value to shareholders are key factors supporting the positive stance. The company has pledged to return a minimum of $4 billion to its shareholders in 2025 through dividends and share repurchases.
Despite the economic uncertainties, Stifel analysts expect Schlumberger Limited’s (NYSE:SLB) margins to remain strong. This stance is supported by the company’s growing Digital business, the strength seen in its Production Systems, and the cost-cutting measures that have been implemented.
Schlumberger Limited (NYSE:SLB) is a global oilfield services company. With a presence in more than 100 countries, the company offers technology, information solutions, and integrated project management services that optimize reservoir performance.
6. ConocoPhillips (NYSE:COP)
Number of Hedge Fund Holders: 70
ConocoPhillips (NYSE:COP) is one of the 10 best oil and gas stocks to buy now. On June 11, Citi reduced its price target for ConocoPhillips (NYSE:COP) from $140 to $115 while keeping a “Buy” rating.
Despite major acquisitions aimed at transformation, ConocoPhillips (NYSE:COP) has performed poorly since early 2024 and has fallen to four-year lows compared to the US energy index. This underperformance has wiped out the gains the stock made through strategic acquisitions.
However, Citi analysts believe this presents a “value opportunity” as ConocoPhillips (NYSE:COP) is positioned to stay resilient even as OPEC’s new strategies create challenges for many in the energy sector. Citi still sees significant upside potential for the stock.
ConocoPhillips (NYSE:COP) is one of the world’s largest independent oil and gas exploration and production companies based on production and proved reserves.
5. The Williams Companies, Inc. (NYSE:WMB)
Number of Hedge Fund Holders: 72
The Williams Companies, Inc. (NYSE:WMB) is one of the 10 best oil and gas stocks to buy now. On May 28, Wells Fargo raised its price target on The Williams Companies, Inc. (NYSE:WMB) from $64 to $67 but kept an “Overweight” rating. The analysts highlighted the company’s strong growth potential as the main reason for the increased price target.
Wells Fargo suggests that The Williams Companies, Inc. (NYSE:WMB) is currently trading higher than its C-Corp peers, using a 2026 estimated EV/EBITDA multiple of 11.9x for WMB against 10.8x for its peers. WMB is trading at a premium and Wells Fargo analysts believe this premium is fair because of the company’s superior growth prospects.
According to the analysts, The Williams Companies, Inc. (NYSE:WMB) can achieve an 11% compound annual growth rate (CAGR) in EBITDA over three years, which is much higher than the 6% median growth expected from its C-Corp peers.
The analysis by Wells Fargo also indicates that if The Williams Companies, Inc. (NYSE:WMB) and its peer group traded at the same valuation multiple in three years, WMB should command a 1.5x premium over the current 1.1x. This change would mean about a 10% increase in WMB’s stock price.
Wells Fargo analysts further explained that The Williams Companies, Inc. (NYSE:WMB) is likely to keep growing at a strong rate even after three years. If this is true, the 1.5x premium could actually be a conservative estimate.
The Williams Companies, Inc. (NYSE:WMB) is an American energy company that specializes in natural gas processing and transportation. The company also has some petroleum and electricity generation assets.
4. Cheniere Energy, Inc. (NYSE:LNG)
Number of Hedge Fund Holders: 75
Cheniere Energy, Inc. (NYSE:LNG) is one of the 10 best oil and gas stocks to buy now. On June 16, UBS maintained its “Buy” rating on Cheniere Energy, Inc. (NYSE:LNG) with a $277 price target. The firm highlighted the company’s plans to expand and its shareholder return strategy.
UBS pointed out Cheniere Energy, Inc.’s (NYSE:LNG) SPL expansion project, which will add a total production capacity of about 20 million tonnes per annum (mtpa) of liquefied natural gas (LNG). The company aims to achieve this through three liquefaction trains, each with a capacity of around 6 mtpa. The project also includes debottlenecking opportunities. UBS estimates the total cost of this project will be between $15 billion and $18 billion.
Cheniere Energy, Inc. (NYSE:LNG) still has about $3.5 billion left under its share buyback program. The company aims to repurchase $4 billion worth of shares by 2027. UBS analysts highlighted that the management team expects to complete the authorized buybacks ahead of schedule.
Cheniere Energy, Inc. (NYSE:LNG) is an American energy company primarily engaged in LNG-related businesses. It is the leading producer and exporter of LNG in the US.
3. Hess Corporation (NYSE:HES)
Number of Hedge Fund Holders: 80
Hess Corporation (NYSE:HES) is one of the 10 best oil and gas stocks to buy now. On June 11, UBS increased its price target on Hess Corporation (NYSE:HES) from $163 to $173 while keeping a “Buy” rating.
UBS analysts raised the price target because of the firm’s updated valuation of Hess Corporation’s (NYSE:HES) Guyana operations. UBS expects stronger production in Guyana. This outlook is supported by tiebacks and infill drilling, as well as lower operating costs.
The firm also noted that Hess Corporation (NYSE:HES) is currently involved in an arbitration process, which is expected to last until late August or September of this year.
Additionally, UBS increased its downside case valuation for Hess Corporation (NYSE:HES) to $126 per share. This suggests that there is now less risk of the stock declining. This new assessment relies on the reported discoverable resources of over 11 billion barrels of oil equivalent (Bpoe). The firm believes that if the resources reach 15 Bpoe, the downside potential could be even lower.
UBS highlighted that Hess Corporation (NYSE:HES) offers a positive 3.4:1 risk/reward ratio compared to Chevron’s price target. The firm believes that Hess Corporation (NYSE:HES) is “the more levered way to gain upside exposure to CVX.”
Hess Corporation (NYSE:HES) is an American global independent energy company that specializes in the exploration and production of oil, gas, and energy solutions.
2. Chevron Corporation (NYSE:CVX)
Number of Hedge Fund Holders: 81
Chevron Corporation (NYSE:CVX) is one of the 10 best oil and gas stocks to buy now. On May 13, HSBC analysts downgraded Chevron Corporation (NYSE:CVX) from a “Buy” to a “Hold” rating and reduced the price target from $176 to $158.
This decision came after the company announced it would reduce its share buyback program when it released its first-quarter earnings.
Chevron Corporation’s (NYSE:CVX) Chief Financial Officer, Eimear Bonner, said that the company’s share repurchases for 2025 might be between $11.5 billion and $13 billion, which would be in the lower end of the company’s guidance of $10 billion to $20 billion.
HSBC analysts pointed out that Chevron Corporation (NYSE:CVX) no longer trades on par with its European competitors in terms of total distribution yield. This change came after the cut in buybacks.
The analysts also noted that Chevron Corporation (NYSE:CVX) is currently trading at a 12-13% discount to Exxon based on expected 2025-26 price-to-cash flow ratios. HSBC analysts believe that this discount is fair given the higher risks associated with Chevron Corporation (NYSE:CVX).
Chevron Corporation (NYSE:CVX) is one of the world’s largest energy corporations. The company produces crude oil and natural gas.
1. Exxon Mobil Corporation (NYSE:XOM)
Number of Hedge Fund Holders: 94
Exxon Mobil Corporation (NYSE:XOM) is one of the 10 best oil and gas stocks to buy now. On June 3, Evercore ISI analysts maintained an “Outperform” rating with a price target of $120 on Exxon Mobil Corporation (NYSE:XOM).
This decision comes after a lunch meeting in New York City with the company’s CEO, Darran Woods, where Exxon’s strategic advantages over its peers were discussed.
The analysts noted that Exxon Mobil Corporation (NYSE:XOM) has better chances for higher returns in its upstream business and has an efficient downstream scale. The company’s streamlined corporate cost structure and operating model were highlighted as key reasons that position the company well for better returns on capital.
Exxon Mobil Corporation’s (NYSE:XOM) efforts to reduce the effects of changing oil prices were highlighted. Over the past 9 years, especially under Wood’s leadership, the company has focused on cutting costs, successfully completed big projects, and investments based on a $35 per barrel assumption. These actions are expected to help Exxon Mobil Corporation (NYSE:XOM) perform better than its competitors.
Analysts also highlighted the company’s ability to manage hydrogen and carbon, which are used in all parts of the business, including low-carbon initiatives. This approach is seen as unique and coherent, making Exxon Mobil Corporation’s (NYSE:XOM) value proposition and business outlook more stable.
To conclude, the report states that XOM will continue to attract a larger share of energy investment flows, from both active and passive investors, and Exxon Mobil Corporation (NYSE:XOM) will remain a leader in the energy industry.
Exxon Mobil Corporation (NYSE:XOM) is an American oil and gas company that manages an industry-leading portfolio of resources. It is one of the world’s largest integrated fuels, lubricants, and chemical companies.
While we acknowledge the potential of XOM as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than XOM and that has a 100x upside potential, check out our report about this cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 10 Best American Semiconductor Stocks to Buy Now.
Disclosure: None.
