In this article, we are going to discuss the best crude oil stocks to buy according to hedge funds.
The global crude oil prices witnessed a slight surge this week following the announcement of a trade deal between the United States and the European Union, and an announcement by President Trump that he would shorten the deadline for Russia to end its war in Ukraine or face sanctions. Moreover, the possible extension of the US-China tariff pause before an August 12 deadline has also provided support to global financial markets and crude prices.
As part of the historic trade deal, the EU has pledged to massively ramp up energy imports from the United States to $250 billion annually for three years. However, it remains to be seen whether such a massive scale of energy trade is even possible, since the total exports of American crude oil, LNG, and metallurgical coal (the three commodities that the EU is most likely to acquire) amounted to approximately $166 billion in 2024 at around current prices. This means that even if the European bloc bought this entire volume, it would still fall significantly short of the $250 billion target.
Our Methodology
To collect data for this article, we scanned Insider Monkey’s database of hedge funds’ stock holdings and picked the top 12 companies operating in the crude oil sector with the highest number of hedge fund investors in Q1 of 2025. The Following are the Best Oil Stocks to Invest in According to Hedge Funds.
Why are we interested in the stocks that hedge funds pile into? 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).
12. Shell plc (NYSE:SHEL)
Number of Hedge Fund Holders: 50
To make sure it can not only survive but thrive through the expected slowdown in global crude oil demand, Shell plc (NYSE:SHEL) announced earlier this year that it would lower its spending to $20-22 billion annually through 2028, while increasing shareholder distributions to 40-50% of cash flow from operations, up from a 30-40% range previously.
Shell plc (NYSE:SHEL) also announced a $3.5 billion share buyback program in May, marking the 14th consecutive quarter in which the company has announced $3 billion or more in buybacks. The oil producer is able to maintain its shareholder payouts even in low-priced environments, given its low distribution breakevens – $40 Brent for dividends, and buybacks continuing at $50.
Shell plc (NYSE:SHEL) is also a top player in the rapidly expanding LNG sector, and the company recently revealed that it expects to add up to 12 million metric tons of additional LNG capacity by the end of the decade. The company has several new projects coming online, including one in Canada, two in Qatar, and others in Nigeria and the UAE.
Artisan Partners stated the following regarding Shell plc (NYSE:SHEL) in its Q1 2025 investor letter:
“Shell is one of the world’s largest integrated oil and gas companies. The business has a durable portfolio of oil and gas resources, which includes a global leadership position in liquefied natural gas (LNG), an attractive and growing market.
The business has been materially transformed over the past two years by a new management team that understands value creation. CEO Wael Sawan and his team have adjusted the capital investment plan to be more focused on the core business and generating returns. Management has also used the company’s strong free cash flow (FCF) to add significant value for shareholders through capital allocation. Over the last three years, Shell has produced about $100 billion in FCF, and the management team has returned all of it through a combination of dividends, buybacks and debt reduction. The current market capitalization is about $200 billion, which means the company has returned over half the market cap to shareholders over the past three years…” (Click here to read the full text)
Shell plc (NYSE:SHEL) is a global group of energy and petrochemical companies with operations in more than 70 countries.
11. Permian Resources Corporation (NYSE:PR)
Number of Hedge Fund Holders: 52
One of the fastest-growing companies in the American crude oil sector, the share price of Permian Resources Corporation (NYSE:PR) has gained by more than 1,600% over the last five years. The oil producer continues to expand its portfolio and announced in May that it had reached an agreement to buy core assets in the Delaware basin from APA Corp. The deal, valued at $608 million, added 13,320 net acres, 8,700 net royalty acres, and 12,000 Boe/d to PR’s portfolio.
The key strength of Permian Resources Corporation (NYSE:PR) lies in its low breakeven cost of $40 per barrel, allowing it to remain profitable and grow even during times of high price volatility. Moreover, the company revealed that it has approximately 25% of 2025 oil production hedged at a price just above $73 per barrel, allowing it to be more opportunistic during a downturn when investments can earn the highest return.
Permian Resources Corporation (NYSE:PR) is also known for its high shareholder returns and, as of the writing of this piece, boasts a hefty annual dividend yield of 4.79%, putting it among the 12 Best Oil and Gas Dividend Stocks to Buy Now.
Artisan Partners stated the following regarding Permian Resources Corporation (NYSE:PR) in its Q1 2025 investor letter:
“We made one new purchase this quarter, adding Permian Resources Corporation (NYSE:PR), an independent oil and gas company. PR is focused solely on the Delaware Basin of West Texas and southwestern New Mexico—the most prolific oil-producing region in the US. The founders and co CEOs, who also have large ownership interests in the business, have sought to build a business that can produce substantial free cash flow, return capital to shareholders and generate attractive equity returns across varied commodities price environments. To achieve these goals, PR has pursued best-in-class operations and responsible capital stewardship by thoughtfully acquiring assets it believes are undervalued and divesting acreage it believes would be better in someone else’s hands, while meaningfully returning capital to shareholders in the form of dividends. We always seek to align ourselves with shareholder-oriented management teams, but this is even more critical when investing in mid-sized energy companies given their dependence on the underlying commodity prices and minimal diversification by business and geography as well as the sector’s general predilection for reinvesting capital for growth rather than returns. Shares were rangebound for much of 2024 as macro fears have weighed on oil prices and energy sector stocks, giving us an opportunity to purchase a strong operator at a favorable price.”
Permian Resources Corporation (NYSE:PR) is an independent oil and natural gas company with operations focused in the Permian Basin, with assets concentrated in the core of the Delaware Basin.
10. Valero Energy Corporation (NYSE:VLO)
Number of Hedge Fund Holders: 55
The share price of Valero Energy Corporation (NYSE:VLO) slumped despite posting better-than-expected results for its Q2 2025 last week. The company’s adjusted EPS of $2.28 was below the $2.71 it posted in the same period last year, but still managed to beat expectations as a rebound in refining margins helped cushion losses in the renewable diesel segment. Valero’s core Refining segment reported an operating income of $1.3 billion during the quarter, compared to $1.2 billion last year, boosted by higher margins.
Despite a drop in profits, Valero Energy Corporation (NYSE:VLO) remains committed to its shareholders and announced a quarterly dividend of $1.13 per share. The company also returned $695 million to stockholders in the second quarter of 2025, including $354 million as dividends and $341 million in the form of stock buybacks.
Valero Energy Corporation (NYSE:VLO) is the largest independent petroleum refiner in the world and a leading producer of low-carbon transportation fuels.
9. Marathon Petroleum Corporation (NYSE:MPC)
Number of Hedge Fund Holders: 57
Marathon Petroleum Corporation (NYSE:MPC) is known for its high shareholder returns, with the company distributing over $1.3 billion to shareholders through dividends and repurchases in the first quarter of 2025. MPLX – the midstream business of Marathon Petroleum – has increased its distribution payment every year since its formation in 2012 and remains well-positioned for further growth, since it has several new projects coming online in the next few years.
Marathon Petroleum Corporation (NYSE:MPC) revealed in May that its midstream business had already announced over $1 billion of strategic acquisitions since the beginning of 2025, which are all expected to be immediately accretive.
Moreover, Marathon Petroleum Corporation (NYSE:MPC) maintains a strong balance sheet, with approximately $3.8 billion in consolidated cash at the end of Q1 2025. Supported by additional undrawn credit facilities of $5 billion, the company is positioned well to have ample liquidity to endure market fluctuations.
Marathon Petroleum Corporation (NYSE:MPC) is a leading integrated downstream energy company that operates the largest refining system in the United States.
8. Devon Energy Corporation (NYSE:DVN)
Number of Hedge Fund Holders: 58
With an investment-grade balance sheet and a $45 corporate breakeven, Devon Energy Corporation (NYSE:DVN) remains well-positioned to thrive even in a low-price environment. Assuming an oil price of $60 per barrel, the company’s management believes it will generate $2.6 billion in free cash flow this year, enough to easily cover the $650 million in cash it needs to pay its dividend.
Devon Energy Corporation (NYSE:DVN) also remains committed to optimizing its business and cutting costs. The company recently announced plans to boost its annual free cash flow by $1 billion by the end of 2026 by reducing drilling and completion costs and improving operating margins. The efforts seem to be bearing fruit as DVN revealed in its Q1 2025 earnings call that it was cutting its FY 2025 CapEx by $100 million, while maintaining its productive capacity for the remainder of the year.
With 58 hedge fund investors in the Insider Monkey database at the end of Q1 2025, Devon Energy Corporation (NYSE:DVN) is counted among the Best Crude Oil Stocks to Buy Now.
Devon Energy Corporation (NYSE:DVN) is a leading independent energy company engaged in finding and producing oil and natural gas, with operations focused onshore in the United States
7. Occidental Petroleum Corporation (NYSE:OXY)
Number of Hedge Fund Holders: 59
A leading producer and one of the largest acreage holders in the Permian Basin, Occidental Petroleum Corporation (NYSE:OXY) boasts some of the lowest-cost, longest-life production assets in the US, allowing the company to stay cash flow positive even with crude oil prices in the low $30s per barrel.
Occidental Petroleum Corporation (NYSE:OXY) has fallen by over 8% since the beginning of the year, with investors concerned about the company’s ballooning debt, especially after its $12 billion acquisition of CrownRock in August last year. However, Occidental revealed in May that it had already repaid a total of $6.8 billion in the previous 10 months, reducing its annual interest expense by $370 million.
In fact, the company has already repaid all of its debt maturing in 2025 and has only $284 million maturing over the next 14 months, which should be easy to cover given the company generated $1.2 billion of free cash flow in Q1 2025.
Occidental Petroleum Corporation (NYSE:OXY) also stands out as it is backed by Warren Buffett himself, with Berkshire Hathaway owning a 28.2% stake in the company.
Occidental Petroleum Corporation (NYSE:OXY) is an independent exploration and production company with assets primarily in the United States, the Middle East, and North Africa.
6. EOG Resources, Inc. (NYSE:EOG)
Number of Hedge Fund Holders: 64
One of the top crude oil stocks for passive income, EOG Resources, Inc. (NYSE:EOG) has delivered 27 years of regular dividends without ever reducing its payouts, which is a rarity in the oil patch. Moreover, the company has grown its cash distributions twice as fast as its peers since 2019 and even has a history of paying special dividends in order to meet its goal of returning at least 70% of its annual free cash flow to shareholders.
To make sure it can deliver the growth necessary to sustain its payouts, EOG Resources, Inc. (NYSE:EOG) announced in May that it is acquiring Encino Acquisition Partners in a deal worth $5.6 billion, giving the company access to an additional 675,000 net core acres and more than 1 billion barrels of undeveloped net resource.
EOG expects the deal to be immediately accretive and boost its cash flow from operations and free cash flow by 9%. As a result, the company bumped its quarterly dividend by 4.6% to $1.02 per share, taking its current annual dividend yield to 3.35%.
EOG Resources, Inc. (NYSE:EOG) is one of the largest crude oil and natural gas exploration and production companies with operations in North America and Trinidad and Tobago.
5. Kinder Morgan, Inc. (NYSE:KMI)
Number of Hedge Fund Holders: 65
Kinder Morgan, Inc. (NYSE:KMI) delivered strong results for its Q2 2025 earlier this month, posting a 24% jump in profits as higher volumes of natural gas were transported through its pipelines, supported by the surging demand for American LNG exports and growing power consumption. KMI’s revenue also grew by over 13% YoY, beating expectations by more than $213 million.
Kinder Morgan, Inc. (NYSE:KMI) also grew its regular quarterly dividend by 2% to $0.2925 per share, marking the eighth straight year that the company has grown its payouts. KMI paid dividends of $1.3 billion in the first half of 2025 and boasts an annual dividend yield of 4.3% as of the writing of this piece, putting it on our list of the 10 Energy Stocks with Fat Dividends.
Kinder Morgan, Inc. (NYSE:KMI) increased its project backlog from $8.8 billion to $9.3 billion during the second quarter of 2025 and even approved another $1.3 billion in expansion projects, adding even more fuel to its growth engine.
Kinder Morgan, Inc. (NYSE:KMI) is one of the largest energy infrastructure companies in North America. The company has an interest in or operates approximately 79,000 miles of pipelines and 139 terminals.
4. Schlumberger Limited (NYSE:SLB)
Number of Hedge Fund Holders: 68
Next on our list of Best Crude Oil Stocks According to Hedge Funds is Schlumberger Limited (NYSE:SLB), the world’s leading provider of technology for reservoir characterization, drilling, production, and processing to the global energy industry.
Schlumberger Limited (NYSE:SLB) announced earlier this month that it has completed the acquisition of ChampionX, bringing the latter’s $850 million in revenue and $190 million in adjusted EBITDA into Schlumberger starting August 1. The transaction is expected to deliver $400 million in annual pre-tax synergies within three years of closing through revenue growth and cost savings. Following the integration of ChampionX, SLB expects second-half 2025 revenue to be between $18.2 billion and $18.8 billion.
Schlumberger Limited (NYSE:SLB) announced a quarterly cash dividend of $0.285 per share this month and currently boasts an annual dividend yield of 3.17%. The company also reiterated its target to pay $4 billion through dividends and share repurchases this year, staying true to its commitment of returning more than 50% of its free cash flow to shareholders.
Ariel Investments stated the following regarding Schlumberger Limited (NYSE:SLB) in its Q2 2025 investor letter:
“Shares of Schlumberger Limited (NYSE:SLB), the largest oilfield services company in the world by revenue, also underperformed amidst falling oil prices and trade tensions. While quarterly earnings came in slightly behind expectations, the market appears more concerned with the rising supply and weak macroeconomic conditions weighing on energy prices and oilfield services demand going forward. Nonetheless, we believe there are tailwinds supporting rising demand over the medium-term, as national oil companies invest in long-cycle projects to grow capacity and address the natural decline of production. We think SLB is the best positioned among the oilfield services companies, given their leading scale and expertise across nearly every product and service category, as well as their exposure to more resilient international markets. In the long run, we expect SLB will continue to evolve their capabilities to help clients with rising energy needs going forward.”
3. ConocoPhillips (NYSE:COP)
Number of Hedge Fund Holders: 70
ConocoPhillips (NYSE:COP) boasts a low-cost portfolio with a cost-to-supply of less than $40 a barrel, cushioning the company’s downside during the recent decline in crude oil prices. Moreover, thanks to its disciplined capital allocation strategy, COP has recently reduced its FY 2025 capital spending guidance by $500 million without impacting production levels, reiterating that it will deliver the same amount of oil and gas but for less money.
With oil prices currently in the upper $60s, ConocoPhillips (NYSE:COP) remains on track to generate significant free cash flow. The oil giant has a consistent, long-term record of distributing a big chunk of this cash to shareholders, averaging an impressive 44.3% payout ratio over the last five years. COP distributed $2.5 billion to shareholders in Q1 2025 and these numbers are expected to receive a significant boost, since the company expects to generate $6 billion in incremental free cash flow by 2029, thanks to its investments in Alaska and in the ballooning LNG sector.
ConocoPhillips (NYSE:COP) has raised its payouts for 10 consecutive years, putting it among the 10 Best and Safe Dividend Stocks to Buy Now.
ConocoPhillips (NYSE:COP) is one of the world’s largest independent E&P companies based on oil and natural gas production and proved reserves.
2. Chevron Corporation (NYSE:CVX)
Number of Hedge Fund Holders: 81
A top choice for investors looking for passive income, Chevron Corporation (NYSE:CVX) returned a record $27 billion to its shareholders in 2024. The company has been growing its dividends for 38 consecutive years and boasts an annual dividend yield of 4.38%, putting it among the 11 Dogs of the Dow Dividend Stocks to Buy Now.
Chevron Corporation (NYSE:CVX) recently made headlines after it completed the acquisition of Hess for roughly $53 billion, adding the latter’s coveted 30% stake in the Stabroek Block in offshore Guyana to the company’s portfolio. The Warren Buffett-backed company already boasts the lowest breakeven levels in the sector at around $30 per barrel, and the integration of the new high-value assets from Hess should help the company grow its production while maintaining low costs.
To make sure it can thrive even during low-priced environments, Chevron Corporation (NYSE:CVX) remains focused on capital discipline and reducing costs. The oil and gas giant is targeting $2 billion – $3 billion in structural cost savings by the end of 2026, and its CapEx budget for 2025 represents a $2 billion reduction from last year.
Chevron Corporation (NYSE:CVX) manufactures and sells a range of high-quality refined products, including gasoline, diesel, marine and aviation fuels, premium base oil, finished lubricants, and fuel oil additives.
1. Exxon Mobil Corporation (NYSE:XOM)
Number of Hedge Fund Holders: 94
Exxon Mobil Corporation (NYSE:XOM)’s vast global scale, strong balance sheet, strict financial discipline, generous payouts, and aggressive growth make it the Best Crude Oil Stock According to Hedge Funds.
Exxon Mobil Corporation (NYSE:XOM) has grown its earnings at an annual rate of roughly 30% over the last five years, with its cash flow also rising at a CAGR of roughly 15% during the period. The oil behemoth has no intentions of slowing down and expects to achieve $20 billion in earnings growth and $30 billion in cash flow growth by 2030, even if Brent prices average just $65 per barrel.
Exxon Mobil Corporation (NYSE:XOM) also remains focused on reducing costs to make sure it can weather a shifting crude oil market. Since 2019, the company has achieved $12.1 billion in structural cost savings, with a target to raise this number to $18 billion by 2030. Moreover, Exxon continues to invest in efficiency, with a goal of achieving a break-even of $35 per barrel by 2027 and $30 per barrel by 2030.
Exxon Mobil Corporation (NYSE:XOM) is famous for its massive payouts, with distributions of over $125 billion in dividends and buybacks over the last five years. The company has announced plans to repurchase $20 billion in shares annually through 2026, and has raised its payouts for 42 consecutive years.
Exxon Mobil Corporation (NYSE:XOM) is one of the largest integrated fuels, lubricants, and chemical companies in the world. The company operates facilities or markets products around the globe and explores for oil and natural gas on six continents.
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