This year’s oil stock prices have fluctuated. Brent oil, the world benchmark, was below $80 a barrel in 2022 when Russia invaded Ukraine. Since then, global economic concerns have sent it back into the $80s.

OPEC agreed to cut its output by 2 million barrels per day starting next month to stabilize crude prices. This has driven oil to the mid-$90s. As those barrels disappear next month, crude might keep rising.

This is typical.

Conservative income investors should use current price moves as a warning to erring on the side of caution when selecting a long-term energy investment. That puts you in the same league as ExxonMobil, TotalEnergies, BP, Shell, and Chevron. Chevron has the strongest balance sheet with a 0.17 debt-to-equity ratio. Financially, it’s well-positioned to handle energy market volatility.

Chevron Stock

Chevron’s (NYSE:CVX) 3.9% dividend yield and a 30-year history of yearly dividend increases make it a Dividend Aristocrat. It hasn’t handled every oil sector up and down as well as this one, but income investors remain a priority—volatile oil. Chevron can ride the surge while preserving dividend investors.

ExxonMobil Stock

This dividend monster benefits from OPEC’s move.

Oil prices are rising in expectation of a tighter oil market due to OPEC’s production decrease. ExxonMobil (NYSE:XOM) is one of the world’s largest oil exploration and production businesses. The impact might be even more significant with the oil giant’s breakeven price decreasing.

ExxonMobil’s breakeven oil price between 2022 and 2023 is $37 per barrel. ExxonMobil can fund its capital-spending program and continue its dividend payout as long as Brent crude averages around this level. At higher Brent crude prices, the corporation can produce more income to support growth, repurchase more shares, and increase dividends. Investors should win.

ExxonMobil’s third-quarter free cash flow doubled year over year, driven by greater output and oil prices. If oil prices recover, the fourth quarter might be substantially stronger than the third. That could help ExxonMobil post solid full-year results and add to the stock’s appeal, especially among income investors who look forward to a dividend raise later this month, the oil stock’s 40th consecutive annual dividend increase. OPEC’s latest move makes ExxonMobil an excellent oil stock to purchase.

Devon Energy Stock: Increasing Crude Oil Profits

Devon Energy has benefited from rising oil prices this year. Operating cash flow doubled during the second quarter, while free cash flow hit a record $2.1 billion. The corporation had a windfall to distribute to shareholders.

Devon (NYSE:DVN) used the money to pay a growing dividend, repurchase shares, strengthen its balance sheet, and increase its portfolio. The company’s dividend outlay jumped 22% in Q2, putting its annualized dividend yield above 8%. It has repurchased 4% of its outstanding shares this year. Its cash position rose to $3.5 billion against $6.5 billion in debt.

Devon’s rising oil exposure helps it profit from OPEC’s move to raise crude prices. It’s a top oil stock to purchase for the inevitable OPEC-fueled price comeback.

Featured Image-  Megapixl @ Jetcityimage

Please See Disclaimer