Is it good to invest in oil stocks?

The world is slowly moving away from fossil fuels toward green alternatives, but that transition will take decades. For the foreseeable future, oil stocks remain an attractive way to invest in the overall health of the global economy because so much of what we do -- from transportation to industry to petrochemicals -- relies on oil.

What oil stocks did Warren Buffett buy?

Buffett owned a number of energy stocks throughout his tenure at Berkshire Hathaway (NYSE:BRKB), but he is best known for the company's large stakes in Occidental Petroleum (NYSE:OXY) and Chevron.

What oil stocks pay a dividend?

Dividends are table stakes for most mature oil companies, not a bonus. Companies like ExxonMobil and Chevron have a long history of constantly raising their dividends. Investors looking for dividends should also consider pipeline companies. They tend to be organized as master limited partnerships, a structure designed to push income through to investors in the form of dividends.

What is the market capitalization of oil stocks?

The largest oil stock by market capitalization is Saudi Aramco, valued by the market at $1.69 trillion, followed by ExxonMobil and Chevron. The top five oil stocks alone account for more than $3 trillion in market capitalization in early 2026.

Best Oil Stocks to Buy in 2026 and How to Invest

Best Oil Stocks to Buy in 2026 and How to Invest in Them

By Lou Whiteman – Updated May 5, 2026 at 4:58 PM EST | Fact-checked by Parker Hicks

Key Points

Oil industry spans production, refining, and pipelines; each segment profits differently based on oil price changes.
Key oil stocks like ConocoPhillips and Devon Energy focus on sustainable dividends and efficient operations.
Enbridge provides high dividends and invests in clean energy, securing its role in the evolving energy sector.

Oil companies do more than drill. The industry includes producers that pull oil out of the ground, refiners that turn crude into gasoline and jet fuel, and pipeline companies that move energy around and collect toll-like fees. That diversity matters because each part of the oil chain wins and loses in different environments.

If you want exposure to oil, the goal shouldn’t be “pick the stock that benefits most if oil spikes.” It should be to own businesses that can survive the down cycles and still reward shareholders.

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An oil rig at sunset. — Image source: Getty Images.

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Ticker Information Table
Name and ticker	Market cap	Dividend yield	Industry
ConocoPhillips (NYSE:COP)	$144.9 billion	2.72%	Oil, Gas and Consumable Fuels
Devon Energy (NYSE:DVN)	$28.9 billion	2.06%	Oil, Gas and Consumable Fuels
Enbridge (NYSE:ENB)	$118.3 billion	5.05%	Oil, Gas and Consumable Fuels
ExxonMobil (NYSE:XOM)	$618.0 billion	2.72%	Oil, Gas and Consumable Fuels
Phillips 66 (NYSE:PSX)	$68.8 billion	2.84%	Oil, Gas and Consumable Fuels
Chevron (NYSE:CVX)	$369.5 billion	3.73%	Oil, Gas and Consumable Fuels
EOG Resources (NYSE:EOG)	$72.2 billion	3.00%	Oil, Gas and Consumable Fuels

Data as of May 7, 2026. Showing 7 of 7 tickers.

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NYSE: COP

ConocoPhillips

Today's Change

(-3.58%) $-4.42

Current Price

$118.90

Key Data Points

Market Cap

$145B

Day's Range

$117.42 - $120.00

52wk Range

$84.28 - $135.87

Volume

13M

Avg Vol

9.8M

Gross Margin

23.54%

Dividend Yield

2.72%

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2. Devon Energy

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NYSE: DVN

Devon Energy

Today's Change

(-8.61%) $-4.39

Current Price

$46.60

Key Data Points

Market Cap

$29B

Day's Range

$46.45 - $48.74

52wk Range

$30.24 - $52.71

Volume

41M

Avg Vol

15M

Gross Margin

23.24%

Dividend Yield

2.06%

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Devon Energy (DVN -8.61%) is a U.S.-focused E&P company. It has diversified operations across several low-cost, oil-rich basins. The company's diversification enables it to produce large volumes of low-cost oil and natural gas, generating plenty of cash.

It pays out as much as 50% of its excess cash flow each quarter via variable dividend payments after funding its fixed base dividend and capital expenses. Devon uses the remaining excess cash to strengthen its balance sheet and repurchase shares. It became one of the largest oil and gas producers in February 2026 when it struck a $21.5 billion all-stock deal to purchase Coterra Energy.

Devon's dividend strategy makes it an enticing option for income-focused investors. They can collect a steady, sustainable dividend throughout the oil price cycle and have the potential to earn significant payments during periods of high prices.

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Dividends Per Share

The dividends a company pays out per share and a commonly used per-share metric.

3. Enbridge

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NYSE: ENB

Enbridge

Today's Change

(-1.29%) $-0.71

Current Price

$54.20

Key Data Points

Market Cap

$118B

Day's Range

$54.12 - $55.04

52wk Range

$43.59 - $55.49

Volume

4.4M

Avg Vol

Gross Margin

32.74%

Dividend Yield

5.05%

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Enbridge (ENB -1.29%) operates one of the biggest oil pipeline systems in the world. It transports 30% of the oil produced in North America and 20% of the natural gas used in the United States. Enbridge also has an extensive natural gas pipeline system, a natural gas utility business, and renewable energy operations.

Enbridge's pipeline operations generate stable cash flow backed by long-term contracts and government-regulated rates. That gives it the cash to be one of the best high-yield dividend stocks while also investing to expand its energy infrastructure operations.

Enbridge has made significant investments in recent years in infrastructure geared toward cleaner energy, including offshore wind energy in Europe and hydrogen. These investments position Enbridge for the future of energy, even as it remains vital to supporting the oil market's current needs.

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NYSE: XOM

ExxonMobil

Today's Change

(-3.96%) $-6.14

Current Price

$148.74

Key Data Points

Market Cap

$618B

Day's Range

$147.09 - $150.25

52wk Range

$101.19 - $176.41

Volume

759K

Avg Vol

22M

Gross Margin

20.92%

Dividend Yield

2.72%

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As one of the largest oil companies on the planet, ExxonMobil (XOM -4.00%) is a fully integrated supermajor. It operates in every segment of the oil and gas industry, including E&P, midstream, petrochemical manufacturing, refining, and, even further downstream, marketing refined and petroleum products to customers.

ExxonMobil has focused its recent efforts on reducing its business costs and boosting efficiency. These investments are beginning to pay off. The company has significantly lowered its oil production costs over the past couple of years by focusing on its highest-return assets while also taking steps to better leverage its massive scale, enabling it to generate lots of cash flow when oil prices are much higher.

This cash flow should continue to protect ExxonMobil's dividend and its status as a Dividend Achiever, or a stock that has increased its payout for 10 consecutive years.

5. Phillips 66

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NYSE: PSX

Phillips 66

Today's Change

(-4.72%) $-8.52

Current Price

$171.75

Key Data Points

Market Cap

$69B

Day's Range

$170.00 - $174.90

52wk Range

$106.34 - $190.61

Volume

83K

Avg Vol

3.2M

Gross Margin

7.04%

Dividend Yield

2.84%

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Phillips 66 (PSX -4.72%) is one of the leading oil refining companies, with operations in the U.S. and Europe. It also has investments in midstream operations and in petrochemicals via its CPChem joint venture with Chevron (CVX -3.88%). Its marketing and specialties business distributes refined products and manufactures specialty products, including lubricants.

Thanks to its large-scale, vertically integrated operations, Phillips 66 is among the lowest-cost refiners in the industry. This is the result of its leveraging its integrated midstream network to obtain the lowest-cost crude for refining and petrochemical feedstocks, as well as its investments in projects that give it higher margins on its products.

Phillips 66 also boasts a strong financial profile, which includes an investment-grade balance sheet with very manageable debt. It also has lots of cash on hand. Its low debt and high cash reserves mean it has ample capital to invest in expansion projects, including renewable fuels.

6. Chevron

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NYSE: CVX

Chevron

Today's Change

(-3.88%) $-7.48

Current Price

$185.16

Key Data Points

Market Cap

$369B

Day's Range

$183.13 - $186.78

52wk Range

$133.77 - $214.71

Volume

11M

Avg Vol

12M

Gross Margin

13.31%

Dividend Yield

3.73%

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Chevron is a global energy titan that operates across every stage of the oil and gas value chain. Think of it as a massive, vertically integrated machine that finds energy in the ground, moves it across the world, and turns it into the fuel in your car or the plastic in your phone.

Chevron has a strong balance sheet and a long history of increasing its dividend while still finding growth in areas like Guyana. The company also recently bought Hess Corp. to round out its offerings.

This is a slow-and-steady bet on future demand for fossil fuels.

7. EOG Resources

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NYSE: EOG

EOG Resources

Today's Change

(-4.38%) $-6.17

Current Price

$134.65

Key Data Points

Market Cap

$72B

Day's Range

$134.52 - $137.60

52wk Range

$101.59 - $151.87

Volume

304K

Avg Vol

5.1M

Gross Margin

40.75%

Dividend Yield

3.00%

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EOG (EOG -4.38%) has been called the "Apple (AAPL +1.18%) of Oil" because of its focus on technology, innovation, and high-margin efficiency. Unlike Chevron, which is a massive integrated company with refineries and gas stations, EOG is an independent E&P company -- a "pure play" focused almost entirely on getting oil and gas out of the ground as cheaply and intelligently as possible.

EOG mostly finds its oil in U.S. shale. The company has some international operations, but its primary focus is on extracting energy from rock formations in the United States. It does not sell gasoline or other products. This business focuses on extracting oil from the ground and selling it to others for refining.

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Oil stocks FAQ

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About the Author

Lou Whiteman is a contributing Motley Fool stock analyst covering aerospace, defense, transport, manufacturing, specialty finance, and bank stocks. Previously, Lou was a financial analyst and senior writer for TheStreet, a venture capital specialist for The Deal LLC, and a high school personal finance teacher. He holds a bachelor’s degree in communications from Loyola University Maryland and completed a fellowship at the ABA Stonier Graduate School of Banking.

TMFLouWhiteman

@louwhiteman

Lou Whiteman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple, Chevron, and Enbridge. The Motley Fool recommends ConocoPhillips, EOG Resources, and Phillips 66. The Motley Fool has a disclosure policy.

Master limited partnerships (MLPs): These are publicly traded partnerships that own and operate energy infrastructure assets, such as pipelines, storage facilities, and refineries. A key feature is their pass-through tax status, which avoids corporate-level income taxes, though investors are taxed on their share of the income.

How to analyze oil stocks

The oil industry is inherently risky for investors. Although each segment of the industry has its own set of risk factors, the oil business is both cyclical and volatile.

Oil demand generally tracks economic growth. A robust economy can support rising oil prices and producer profitability. However, geopolitics and capital allocation also play crucial roles in the industry.

The world's largest oil-exporting nations include members of OPEC (Organization of the Petroleum Exporting Countries), a cartel that coordinates members' oil policies. OPEC's actions can significantly affect oil prices. It can withhold supply to push prices higher or increase its output to drive them lower. OPEC has wielded its power over the years, causing massive fluctuations in oil prices.

Meanwhile, independent oil companies can also affect oil prices. If they allocate too much capital to new projects, they can cause an oversupply and weigh on prices. If they hold back too much, they can cause prices to surge. Since oil and gas assets are developed over a long time, companies cannot quickly increase their supplies in response to favorable market conditions.

Given the volatility of oil prices, an oil company must have three crucial characteristics to survive the industry's inevitable downturns:

A strong financial profile with an investment-grade bond rating, significant amounts of cash on hand or ample access to affordable credit, and manageable, well-structured debt maturities.

Low operating costs or relatively stable cash flow streams. E&P companies need to be able to sustain operations profitably; in 2025, that meant oil prices of any where from $30 per barrel for conventional wells to $75 for oil sands. Midstream companies should get more than 85% of their cash flow from steady revenue sources such as fee-based contracts. Downstream companies should have operating costs below the industry average.

Diversification. Oil companies should operate in more than one geographical region or be at least partially vertically integrated by engaging in several different activities.

Best Oil Stocks to Buy in 2026 and How to Invest in Them

Key Points

Key Data Points

2. Devon Energy

Key Data Points

3. Enbridge

Key Data Points

Key Data Points

5. Phillips 66

Key Data Points

6. Chevron

Key Data Points

7. EOG Resources

Key Data Points

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Oil stocks FAQ

About the Author

Read Next

Stocks Mentioned

Premium Investing Services

Oil stocks FAQ

Is it good to invest in oil stocks?

What oil stocks did Warren Buffett buy?

What oil stocks pay a dividend?

What is the market capitalization of oil stocks?

Top oil stocks to consider

1. ConocoPhillips

2. Devon Energy

3. Enbridge

4. ExxonMobil

7. EOG Resources

Types of oil stocks

How to analyze oil stocks

Benefits and risks of investing in oil stocks

How to invest in oil stocks

Related investing topics

FAQ

Key Data Points

Key Data Points

Key Data Points

Key Data Points

Key Data Points

Key Data Points

5. Phillips 66

6. Chevron