EOG Resources Inc (NYSE:EOG) is one of the top oil stocks in America. It has a top-tier position in the Eagle Ford Shale to go along with solid positions in both the Bakken Shale and Permian Basin. Because of this it's simply printing money, making it one of the top stocks investors can buy to profit from America's oil boom.

That said, EOG Resources is facing one huge risk that could derail it in 2014.

Falling commodity prices
According to the U.S. Energy Information Agency, oil prices in America should average about $95 per barrel for West Texas Intermediate benchmarked oil in 2014. However, the Agency does see the potential for U.S. oil to trade as low as $63.90 and as high as $131.44 in 2014 as there is never any certainty when it comes to oil prices. However, there appears to be more risks to the downside in 2014, as increased production from the Permian Basin could push more supply onto the marketplace. This has some analysts suggesting that oil prices could drop to as low as $70 per barrel in 2014. This is a huge risk to oil companies like EOG Resources, and it could really derail the stock in the year ahead.

Hedging helps
EOG Resources does a pretty good job mitigating this risk by hedging its exposure to commodity prices in the short term. This locks in its near-term cash flows, enabling the company to meet its obligations. Looking ahead to 2014, the company has hedges in place covering production of 138,500 barrels of oil per day at an average price of $96.45 per barrel through the end of June. However, this is a company with average daily production of 235,000 barrels in the third quarter of 2013. It is also expecting best-in-class production growth in 2014 and beyond. Not only that, but EOG only has 58,000 barrels of oil production per day hedged in the second half of the year.

If oil prices take a hit in 2014, which is possible as America's oil production boom continues, it could have a negative effect on EOG Resources cash flow, especially in the back half of the year. Some of its peers like Devon Energy Corp (NYSE:DVN) have taken a more active role to hedge oil production. The company had 142,000 barrels of oil production per day hedged at $95 for the current fourth quarter. That's about 80% of its forecasted production volumes. Further, Devon Energy has 138,000 barrels of oil production per day hedged for all of 2014 at $92 per barrel, which puts it well ahead of EOG Resources if prices plunge.

Others like Kodiak Oil & Gas Corp (UNKNOWN:KOG.DL) have a base hedging program in place, but look to hedge additional volumes as wells are completed and new production is added. For example, Kodiak Oil & Gas has 24,150 barrels of oil per day hedged in 2014, with another 3,625 barrels per day hedged in 2015. That is well under the company's current projected sales volume of up to 44,000 barrels of oil equivalent per day. However, this is a company that hedged 23,030 barrels of oil per day in 2014 while it expected to see average production of 29,200 barrels of oil equivalent per day for the year, with some of that production being natural gas.

EOG Resources' other big hedge
That said, falling oil prices might not matter as much to EOG Resources as they would to another producer. That's because EOG Resources has access to premium markets thanks to its ownership of rail loading and unloading facilities. Because of this, EOG Resources actually enjoyed a $8.19 per barrel premium over West Texas Intermediate in 2013. This market flexibility should enable it to fetch higher prices for its oil in 2014 as well. That's important, because globally benchmarked Brent crude oil is expected to sell for an $11 premium to West Texas Intermediate in 2014, according to the EIA.

Investor takeaway
EOG Resources does not hedge as much of its production as Devon Energy or Kodiak Oil & Gas. That's a huge risk for the company if oil prices take a plunge as some expect. However, the company's expertise in oil-by-rail should help it offset some of those losses, as it can net premium prices for its oil. That's why I think EOG Resources is still a top oil stock to own, even if prices do take a hit in 2014.