Three Oil Stocks to Purchase to Protect Against War

Three oil stocks to purchase to protect against war feature U.S.-based companies that would be vital for the country’s leaders to safeguard from harm.

The three oil stocks to purchase are providing an essential source of energy that operates internal-combustion gasoline-powered vehicles. Oil also can be processed in refineries through fractional distillation to produce other essential fuels, such as diesel for transportation and machinery, jet fuel and heating oil. The markets and economies throughout the world are vulnerable if the military actions that occurred between Israel and the United States on one side and Iran on the other last weekend extend well into the future.

The risk to commerce is significant with shipping activity essentially stopping near the critically important Strait of Hormuz since last weekend, with some tankers holding back from the area. Oil and natural gas prices have jumped but the advanced of most oil stocks on Monday, March 2, generally turned into a pullback on Tuesday, March 3.

When I checked oil stock prices on Monday morning, two major producers Exxon Mobil (NYSE: XOM), headquartered in the Houston suburb of Spring, Texas, had risen 0.66%  and Houston-based Chevron (NYSE: CVX), jumping 1.07%. Exxon Mobil finished up 1.13% from the close March, Feb. 27, to the close on Monday, March 2, before closing down 1.55% on Tuesday, March 3. Chevron advanced 1.52% on March 2 but dipped 0.44% on March 3.

Part of the reason for the pullback on March 3 may stem from concerns that the military conflict may drag out, related economic weakness and Iran’s plans to stop the flow of tankers carrying oil of liquefied natural gas (LNG) through the Strait of Hormuz that is adjacent to its border on the south. Roughly 20-30% of global daily oil consumption and 20% of liquefied natural gas pass through the relatively narrow Strait of Hormuz, making it the world’s most significant oil transit chokepoint. Analysts say a sustained price hikes in oil and risk renewed fiscal pressures and could slow economic growth, raising fears of a 2022-style energy crisis.

Three Oil Stocks to Purchase to Protect Against War: EPD

I recently scaled back some of my stock holdings recently, but I chose to keep Houston-based Enterprise Products Partners (NYSE: EPD). EPD is pursuing growth projects to enhance cash flow resilience while upholding its financial metrics. Analysts recently revised EPD’s valuation slightly upward due to its stable distribution yield and defensive characteristics amid market volatility.

The company currently offers a dividend yield of 5.90%, and most recently paid a quarterly dividend of 54.5 cents per share on Oct. 31. The total return for EPD so far this year is 16.44, and it rose 7.80% in the past month.

EPD has fared well so far this week, with its share price gaining 1.33% on March 3 from its close on March 2, after rising 2.07% on March 2.

The stock also is a recommendation of Jim Woods in the Forecasts & Strategies investment newsletter that he leads. As a former U.S. Army paratrooper and officer, Woods, who now is the editor of the Forecasts & Strategies investment newsletter and of the Five Star Trader advisory service, cited the following words recently when reacting to the current military conflict with Iran that involves the United States and Israel.

“War is nothing but a continuation of politics with the admixture of other means.” The quote originally is from Carl von Clausewitz, a Prussian army officer and military theorist who stressed the “moral” and political aspects of waging war.

Chart courtesy of www.stockcharts.com.

Three Oil Stocks to Purchase to Protect Against War: XOM

Exxon Mobil Corp. (NYSE: XOM) is best known as an oil company but also is engaged in providing natural gas. Woods, a seasoned stock picker, is recommending ExxonMobil (NYSE: XOM) for the publication’s Income Multipliers portfolio.

Worldwide oil industry giant Exxon Mobil operates in more than 56 countries, with 61,000 scientists, engineers, researchers, technicians, professionals and other employees. The company’s size and capabilities are cited by Woods, who chose the stock for the Income Multiplier portfolio in Forecasts & Strategies. The stock pays a “great dividend” and boasts a double-digit-percentage gain so far this year, he added.

Exxon Mobile offers a 3.41% dividend yield and is up 12.20% so far in 2025, as well as 4.34% in the past three months. However, XOM dipped 0.56% in the last month. Woods is among many fans of XOM.

Jim Woods heads the Forecasts & Strategies newsletter.

“Over the last 25 years, XOM’s dividend has averaged a growth rate of 6.4%,” said Michelle Connell, who heads Dallas-based Portia Capital Management.

Connell expressed confidence that the dividend growth rate can be maintained, based on the company’s “very powerful portfolio of strategic assets.” One asset is its oil reserves in Guyana that can be drilled with relatively low cost, thereby increasing XOM’s cash flow significantly, she added.

Another key asset is XOM’s natural gas reserves, Connell continued. Specifically, 40% of the electricity generated in the United States is powered by natural gas, she added.

“Data centers require a significant amount of electricity to be operational,” Connell counseled. “In the next three years, data centers are expected to demand 3.5 times the amount of electricity that they’re utilizing now. XOM will be able to profit from this new requirement.”

Michelle Connell heads Portia Capital Management.

A diverse asset portfolio has allowed XOM to reduce its costs to compensate for declining revenues associated with lower oil prices, Connell said. She forecast that the company’s operating margins would remain stable at about 9%.

“This backdrop will be good for energy investors interested in dividends and/or capital appreciation,” Connell counseled.

Chart courtesy of www.stockcharts.com.

At the end of last year, Exxon released an updated long-term plan that included a $5 billion increase to its earnings and cash flow targets for 2030. The company’s management shared a goal of achieving these new targets without increasing the company’s capital expenditures, said Michelle Connell.

Exxon’s leaders recently spoke of tapping large growth opportunities in its Permian Basin properties. They are also evaluating options in Venezuela and in the Middle East, Connell continued.

In addition to the company’s traditional energy business, XOM also has non-traditional energy activities. These businesses include advanced batteries, as well as low-carbon solutions for data centers.

“Exxon pays a healthy dividend of 2.84% and has been increasing it on average over 4% every year,” Connell commented. “As its cash flow continues to grow, XOM may increase its dividends at a higher rate.”

Three Oil Stocks to Purchase to Protect Against War: CVX

Chevron has been our top pick in the integrated and refining category of oil stocks due to its near-term free cash flow generation potential, as well as strong project execution, BofA Global Research wrote in a research note. The BofA analysts expressed clarity on the free cash flow durability of the company through the end of the decade and reiterated its buy recommendation.

Since acquiring PDC Energy in August 2023 for $6.3 billion and Hess Corporation in July 2025 for $53 billion, Chevron is offering enhanced long-term visibility and reinforced confidence in its 2030 outlook, although numbers were near consensus estimates, BofA wrote. Each acquisition brought unique assets to help Chevron grow.

Denver based PDC Energy, formerly Petroleum Development Corporation, had been an independent upstream oil and gas company focused on developing unconventional, liquid-rich, horizontal assets in the Wattenberg Field of Colorado and the Delaware Basin of Texas. Chevron needed to win a legal battle with Exxon Mobil to acquire Hess Corporation. That merger united Hess’s prime assets in Guyana and the Bakken shale with Chevron’s portfolio, enhancing long-term cash flow, boosting U.S. oil production and securing high-margin resources.

Chevron management highlighted free cash flow (FCF) growth of more than 10% of compound annual growth rate (CAGR) through 2030, implying 2030 free cash flow of $28-30 billion (versus consensus estimates of $29 billion), as well as a steady share buyback range of $10-20 billion. However, under a slightly lower Brent price range of $60-80 per barrel of oil, versus $60-85 previously projected.

Both Exxon and Chevron have exposure to an extended shutdown of the Strait of Hormuz. Each company has vast integrated Middle Eastern operations and global shipping.

Chevron recently halted production at its Leviathan field in a massive offshore natural gas reservoir located in the Eastern Mediterranean Sea, specifically within the Israeli Exclusive Economic Zone (EEZ). While the shutdown poses operational risks to the company’s regional assets, it simultaneously boosts the company’s earnings amid surging global oil prices.

Chart courtesy of www.stockcharts.com.

Three Oil Stocks to Purchase to Protect Against War: Woods’ Wisdom

“As someone who decades ago raised his right hand and swore an oath to protect and defend the Constitution as a member of the U.S. Army, I don’t take war or military action lightly, Woods wrote in the March 2 edition of his weekly update of Forecasts & Strategies. “Yet sometimes, war is necessary. In the case of Iran, not only do I think war is necessary, but it is decades overdue. The Islamic theocracy kills its own citizens, sponsors terrorism through its proxies all around the globe, promotes and funds radical Islamic teachings and even suborned the murder of Salman Rushdie for the ‘crime’ of writing a novel. These are reasons alone to wage armed conflict on Iran, but the real reason, as President Trump correctly said, is that Iran must not be allowed to acquire and/or produce a nuclear weapon.

“Islamic theocrats in control of apocalyptic weaponry are antithetical to the survival of the human species, full stop. Stymieing this situation now is in the interest of the entire free world, and that’s why the actions taken over the weekend are, in my view, both justified and laudable. Of course, the consequences of this action by the United States, along with Israel, has understandably caused a lot of angst geopolitically. It’s also ramped up uncertainty in global financial markets. Yet here is something I think you’ll be relieved to hear: unless the situation materially deteriorates, I do not expect it to be a material influence on stocks.”

Three Oil Stocks to Purchase to Protect Against War: Geopolitical Risk

The military conflict in the Middle East is a huge geopolitical risk. Iran’s next group of leaders have an opportunity to usher the country back into an era of economic growth and international acceptance if it turns successfully toward freedom and what could become its own version of democracy.

The killing of tens of thousands of Iranian citizens who protested the repressive and terrorist-supporting religious leaders during the nations past 47 years is a deep loss that cannot be cleansed from the nation’s decades-long past of accepting needless human suffering and compounding it. If Iran rebuilds its ties with the United States and other nations it now opposes, stops trying to eradicate Israel, ceases funding and using terrorist groups as proxies to wage inhumane attacks on civilians and adopts policies of peace and trade, the result could be prosperity.

It is possible but probably not likely that visionary leaders with those goals could emerge and gain power. The result could be enhanced quality of life and the implementation of new ideas and businesses that could help the country restore its past commercial history that spans millennia. Iran’s history is rooted in its strategic position along the ancient Silk Road that bridges East and West. It now remains to be seen what direction Iran will take.

Paul Dykewicz, www.pauldykewicz.com, is an accomplished, award-winning journalist who has written for Dow Jones, the Wall Street Journal, Investor’s Business Daily, USA Today, the Journal of Commerce, Seeking Alpha, GuruFocus and other publications and websites. Paul is the editor of StockInvestor.com and DividendInvestor.com, a writer for both websites and a columnist. He further is the editorial director of Eagle Financial Publications in Washington, D.C., where he edits monthly investment newsletters, time-sensitive trading alerts, free e-letters and other investment reports. Paul previously served as business editor of Baltimore’s Daily Record newspaper. Paul also is the author of an inspirational book, “Holy Smokes! Golden Guidance from Notre Dame’s Championship Chaplain,” with a foreword by former national championship-winning football coach Lou Holtz. Follow Paul on Twitter @PaulDykewicz.