Oil is one of the best-performing asset classes in 2022. In fact, since hitting lows of under $20 per barrel in 2020, oil has increased in value by over 1,000%. As such, now could be a great time to gain exposure to leading oil companies.

In this guide, we discuss the 10 best oil stocks to buy right now and how to complete your investment at a commission-free broker.

The 10 Best Oil Stocks to Buy in 2022

The 10 companies outlined below represent the overall best oil stocks to invest in right now.

  1. ConocoPhillips – Overall Best Oil Stock to Buy Now
  2. Marathon Petroleum  – Top US-Based Oil & Gas Stock for Long-Term Growth
  3. Antero Resources  – Best Oil Stock for Momentum
  4. ExxonMobil  – Great Oil Stock to Own for Dividend
  5. BP  – Diversify Your Oil Stock Investments Overseas
  6. Phillips 66  – Leading Oil Refinery Stock for Stability
  7. Chevron  – Established Oil Stock Involved in the Entire Supply Chain
  8. Halliburton  – Large Oil Service Provider With Attractive Upside Potential
  9. Shell  – Undervalued Oil Stock to Buy on the Cheap
  10. China Petroleum – Large-Cap Oil Stock With Huge Dividend Yield

You can invest in these top oil stocks with 0% commission using our recommended stock broker, eToro.

Your capital is at risk. 68% of retail investor accounts lose money when trading CFDs with this provider.

When it comes to buying stocks for the first time, you need to ensure that you’ve researched the markets and historical data thoroughly. Before making a decision on which oil stocks are right for your portfolio – be sure to read our in-depth analysis.

A Closer Look at the Best Oil Stocks to Invest in

Just because oil as a commodity has seen its value increase ten-fold since the pandemic began, this isn’t to say that all companies operating in this sector are worth considering for your portfolio.

As such, researching the best oil stocks for 2022 is crucial to ensure that you are making smart investment decisions. To point you in the right direction – consider the 10 oil companies analyzed below.

1. ConocoPhillips – Overall Best Oil Stock to Buy Now  

The overall best oil stock to buy now for your portfolio is ConocoPhillips. Founded in 2002, ConocoPhillips is a major US-based oil company with its stock listing on the NYSE. The firm operates in over a dozen global regions – including but not limited to Norway, Malaysia, Australia, and Canada.

Domestically, Founded in 2002, ConocoPhillips is a major US-based oil company with its stock listing on the NYSE. Domestically, ConocoPhillips has a strong foothold in the Texas oil scene. In terms of why ConocoPhillips stands out as the overall best oil stock to invest in for 2022 – this largely centers on how well its shares have performed against the broader markets.

ConocoPhillips stock

For example, over the prior five years, the SPDR S&P Oil & Gas Exploration & Production has declined in value by 7%. In comparison, and during the same period, ConocoPhillips stock has increased by 103%. Over the prior 12 months, ConocoPhillips stock has risen by 92% in comparison to the 70% gains generated by the SPDR S&P Oil & Gas ETF.

What we also like about this top-rated oil stock is that ConocoPhillips has a solid dividend program in place. As of writing, the firm is offering a running dividend yield of 2.33%. Moreover, with a P/E ratio of 16.5 times as of writing, ConocoPhillips could still be somewhat undervalued.

Your capital is at risk. 68% of retail investor accounts lose money when trading CFDs with this provider.

2. Marathon Petroleum  – Top US-Based Oil & Gas Stock for Long-Term Growth   

Founded in 2009, Marathon Petroleum is another US-based oil stock that is worth considering for your portfolio today. Specializing in both crude oil and gasoline, Marathon Petroleum is one of the largest wholesale suppliers in this industry. As per its most recent earnings report, Marathon Petroleum now has the capacity for producing nearly 3 million barrels of crude oil per day.

This is especially crucial in the current economic climate, where demand for oil far outweighs supply. In terms of its stock price performance, Marathon Petroleum shares are up nearly 70% over the prior five years. Over a 12-month period, the stocks have increased by 57%. As such, this highlights that much of the firm’s recent growth has been achieved in the prior year.

Marathon Petroleum stock

We also like Marathon Petroleum stock for its attractive running dividend yield of over 2.7%, as of writing. Perhaps the main drawback with this oil stock is that based on prices as of writing, Marathon Petroleum is carrying a huge P/E ratio of nearly42 times. As such, this does indicate that the stock could be overvalued.

Your capital is at risk. 68% of retail investor accounts lose money when trading CFDs with this provider.

3. Antero Resources  – Best Oil Stock for Momentum    

If you’re looking for the best oil stock in terms of momentum, look no further than Antero Resources. This top-rated oil stock has outperformed the broader market by a considerable amount in recent years. In fact, over the prior 12 months alone, Antero Resources stock has witnessed gains of over 200%.

Founded in 2002, Antero Resources specializes in the exploration of hydrocarbon via fracking technologies. Its suite of natural resources is vast – with Antero Resources involved in the extraction of natural gas, petroleum, ethane, and more.

Antero Resources stock

Although Antero Resources is enjoying a strong upside momentum, it is important to note that the stock is over 40% down from when it first listed on the NYSE back in 2013.

And as such, it will come as no surprise to learn that Antero Resources does not pay a dividend. On the other hand, as of writing, the firm is still carrying a market capitalization of under $10 billion. Therefore, the upside potential with Antero Resources stock is highly attractive.

Your capital is at risk. 68% of retail investor accounts lose money when trading CFDs with this provider.

4. ExxonMobil  – Great Oil Stock to Own for Dividends    

Founded in 1999 through the merger of Exxon and Mobil, this US-based stock is a major producer of oil and has. Listed on the NYSE with a huge market capitalization of over $350 billion, ExxonMobil is one of the largest oil stocks in this industry. If you’re in the market for income, ExxonMobil is perhaps the best oil stock for dividends.

As of writing, the oil and gas giant is offering a running yield of over 4.2%. With that said, this is somewhat lower than the 7-8% that ExxonMobil was offering in 2021. Nonetheless, we also like ExxonMobil for its attractive P/E ratio – which stands at just over 15 times as of writing.

ExxonMobil stock

In terms of its stock market performance, ExxonMobil shares have increased by more than 47% over the prior 12 months. Over a 5-year period, the shares have remained virtually flat – with growth of just under 1%. Finally, it should be noted that a major red flag with this oil stock is that its entry into the Dow Jones index was replaced by SalesForce in 2020.

Your capital is at risk. 68% of retail investor accounts lose money when trading CFDs with this provider.

5. BP  – Diversify Your Oil Stock Investments Overseas     

BP is a UK-based oil and gas stock with its primary listing on the London Stock Exchange. The firm has had a rocky ride in the markets ever since its Deepwater Horizon scandal – which has resulted in BP paying fines worth over $70 billion since 2010. With that said, there are still arguments to be made about BP being one of the top oil stocks to buy right now.

First and foremost, BP is carrying a P/E ratio of just over 13 times. As such, this potentially indicates that the oil stock can be purchased at a favorable entry price. Second, As of writing, BP is paying an attractive running dividend yield of nearly 4.4%. Over the prior 12 months of trading, BP stocks are up 23%.

bp stocks

In comparison to the broader oil and gas markets, this is below par. Moreover, BP shares are down nearly 15% over a 5-year period – which is especially alarming. However, BP is still a major player in the global oil sector and as such – this stock could be worth a punt at current prices.

Your capital is at risk. 68% of retail investor accounts lose money when trading CFDs with this provider.

6. Phillips 66  – Leading Oil Refinery Stock for Stability       

On the one hand, it should be noted that Phillips 66 has, just like BP, underperformed the broader market in recent years. However, what Phillips 66 does offer for your portfolio is long-term stability. Crucially, Phillips 66 is one of the best oil stocks for dividend consistency – as it has shown over the prior 10 years.

As of writing, this top-rated oil stock will get you a running dividend yield of over 4.2%. Moreover, we also like the fact that Phillips 66 has initiated various share buyback schemes over the past decade, which again, highlights just how solid this oil stock is in terms of its balance sheet and operating cash flow.

Phillips 66 stock

What we also like about Phillips 66 is that the firm has some of the lowest operating costs in the US refinery space. Moreover, we also like that in buying Phillips 66 stock, you will also be gaining exposure to the renewable energy industry.  In terms of its performance, Phillips 66 stock is up just 5% and 11% over the prior one and five years, respectively.

Your capital is at risk. 68% of retail investor accounts lose money when trading CFDs with this provider.

7. Chevron  – Established Oil Stock Involved in the Entire Supply Chain         

Founded in 1879, Chevron is one of the most established oil companies in the US. Fast forward to 2022 and the firm is now operational in more than 180 nations globally. In terms of its key markets, Founded in 1879, Chevron is one of the most established oil companies in the US.

Chevron has exposure to virtually every step of the global supply chain of oil. This includes everything from exploration and production to refining and logistics. And, with such a diverse business model, Chevron is one of the best stocks to buy when oil is low.

Chevron stocks

When it comes to recent performance, this oil stock has witnessed gains of over 57% in the prior 12 months. Over a 5-year period, however, Chevon stocks are up just 50% – which is far below the market average. On the other hand, we do like that Chevron is offering a 3.4% running dividend yield as of writing. Moreover, its P/E ratio of 20 times is reasonable.

Your capital is at risk. 68% of retail investor accounts lose money when trading CFDs with this provider.

8. Halliburton  – Large Oil Service Provider With Attractive Upside Potential      

Next up on our list of the best oil stocks to buy for 2022 is Halliburton. This stock does not extract or produce oil itself. On the contrary, Halliburton is involved in providing products and services to the broader energy industry. In doing so, this ensures that conventional oil companies meet their exploration targets in a cost-efficient manner.

Founded in 1919, Halliburton stock is listed on the NYSE. As of writing, the firm is carrying a very attractive market capitalization of $34 billion, which, many market analysts argue is undervalued. Moreover, over the prior 12 months of trading, Halliburton stock has increased by more than 80%.

Halliburton

As noted earlier, the SPDR S&P Oil & Gas ETF has grown by 70% during the same period, which means that Halliburton continues to outperform the wider sector in the short term. With that said, Halliburton stock is down 22% when compared to five years prior, which is a major red flag. Finally, as of writing, Halliburton is offering a running dividend yield of over 1.2%.

Your capital is at risk. 68% of retail investor accounts lose money when trading CFDs with this provider.

9. Shell  – Undervalued Oil Stock to Buy on the Cheap      

If you’re in the market for undervalued companies from the energy sector, Shell could be one of the best oil stocks for this purpose. In a nutshell, this oil and gas giant, based on prices as of writing, is carrying a P/E ratio of just over 10 times. This potentially makes it hugely undervalued – especially when compared to the market average.

Furthermore, Shell looks even more attractive when you consider its running dividend yield of over 3%, as of writing. Looking at the recent performance of Shell, the oil stock has generated gains of more than 47% over the course of the past year. Over the prior five years, however, Shell stocks have decreased by a little under 2%.

shell stock

If you want to gain exposure to this top-rated oil company – the shares have their primary listing on the London Stock Exchange. You can, however, invest in this oil stock at eToro on a 0% commission basis from just $10 – even if you’re based in the US.

Your capital is at risk. 68% of retail investor accounts lose money when trading CFDs with this provider.

10. China Petroleum – Large-Cap Oil Stock With Huge Dividend Yield      

If you’re looking to diversify your investments in the emerging markets, China Petroleum is one of the best oil stocks to consider. Although its stock is listed in both Shanghai and Hong Kong, you can easily invest in this company from the US at eToro without paying any commission.

Nonetheless, one of the main reasons why we like this oil stock is that it is paying a huge running dividend yield of over 6.6% as of writing.

china petroleum stock

This will suit those of you that seek regular income in addition to capital gains. In addition to an attractive dividend program, China Petroleum, based on prices as of writing, is carrying a small P/E ratio of just 7.4 times. As such, you can grab a bargain by adding this undervalued oil stock to your portfolio.

Your capital is at risk. 68% of retail investor accounts lose money when trading CFDs with this provider.

How to Judge the Best Oil Stocks to Buy

Now that we have analyzed the 10 best oil stocks to buy right now – we can take a closer look at what time takes to find the right investment for your portfolio.

Performance vs Broader Oil Markets

Perhaps the first thing to assess when searching for the best oil stocks 2022 is to look at how the company has performed against the broader market.

There are many ways in which you can do this. Albeit, a great reference point is the previously discussed SPDR S&P Oil & Gas ETF. Put simply, this is one of the largest ETFs in the oil and gas industry – and it tracks a basket of leading companies that operate in this space.

best oil stocks to buy

Once again, over the prior 1-year, the SPDR S&P Oil & Gas ETF has increased by 70%. This is why we like ConocoPhillips as one of the best oil stocks to buy, as the firm has outperformed the ETF with gains of 92% over the same period.

This is also the case with Halliburton, which has increased by more than 80% in the past year. On the other hand, other oil stocks that we have discussed today have underperformed the wider market. As such, this is something to bear in mind when you conduct a risk assessment of your chosen oil stocks.

Operating Costs and Break-Even Price

Companies that are involved in the exploration, production, and transportation of oil are prone to huge operating costs. And as such, this will have a major say on how much profit the oil stock is able to make.

  • The general way that operating costs are calculated in this industry is on a per-barrel basis.
  • As a prime example, it was recently reported that ExxonMobil has a break-even point of $41 per barrel.
  • This means that when oil prices surpass $100 per barrel – as they are at the time of writing, ExxonMobil can generate much wider profit margins.

However, when oil prices once again retreat – which they will if and when OPEC agrees to increase production levels, companies with high operating costs will likely suffer the most.

Dividend Program 

Oil companies are some of the best dividend payers in the stock market. In fact, other than Antero Resources, all of the companies from our list of the best oil stocks have a solid dividend program in place.

As such, when you invest in oil companies, you can generate a consistent income stream in addition to capital gains. In particular, China Petroleum is offering a running dividend yield of over 6.6% as of writing.

Diversification Into Renewables 

Another metric to look for when searching for the best oil stocks for your portfolio is whether or not the firm in question is looking to diversify into renewable energy.

After all, by the year 2030, many governments around the world have committed to banning conventional petrol and diesel cars. Therefore, established oil companies will need to act fast to ensure they get a head start in the renewables industry.

Recovery Since COVID 

It is also a good idea to see how your chosen oil stock has recovered since the huge capitulation that virtually all companies in this sector experienced in the midst of the pandemic.

In many cases, some of the best oil stocks that we analyzed on this page have not only recovered their COVID-related share price losses – but have since gone on to achieve new heights.

However, some firms – such as BP, are still trading at a share price that is lower than pre-pandemic levels.

Are Oil Stocks a Good Investment?

If you’re looking to buy the best oil stocks simply because of how quickly this commodity has grown in value over the past year, then it is important that you take a step back and conduct some additional research.

After all, oil is an extremely volatile asset class that over the past few decades, has traded within a relatively predictable range. Moreover, as noted earlier, there is often a huge disparity between oil prices and companies operating in this space.

To ensure you invest in oil stocks with your eyes wide open – below we discuss some of the main considerations – both good and bad, to make before proceeding.

Correlation Issues

Inexperienced commodity investors will often make the mistake of thinking that when oil prices increase, so will the value of stocks operating in this sector. However, this couldn’t be further from the truth.

On the contrary, the display between the rise and fall of oil prices and specific stocks in this arena can be large.

  • As a prime example, in the year prior to writing this guide, Brent crude oil was trading at $62 per barrel.
  • As of writing, Brent crude oil is trading at $105 per barrel.
  • This means that over the course of one year, Brent crude prices have increased by just under 70%

As we covered in our analysis of 10 good oil stocks to buy – some companies have generated gains in excess of 70% over the prior year. While in other cases, some oil stocks have made considerably less.

And as such, if you are looking to gain exposure to the global price of oil as best as possible – then stocks might not be the right benchmark for you.

Instead, you might be more suited for an index tracker fund that has physical exposure to crude oil and thus – offers a more consistent correlation with global prices.

Renewables are the Future

Although oil supplies are still plentiful, there is no denying that the world is slowly but surely becoming greener. At the forefront of this is the eventual transition from crude oil to renewable energies.

This sentiment is supported by the fact that electric carmaker Tesla is now the largest automobile company globally and a solid member of the $1 trillion market capitalization club. If you’d like to learn how to buy Tesla stock in 2022, be sure to read our detailed guide.

which oil stocks to buy right now

With this in mind, it is important that conventional oil and gas companies have a plan in place to make the transition into renewable and greener energy sources. If they don’t, they could very quickly become irrelevant.

Oil Stocks are Prone to Global Commodity Prices

One of the major challenges facing companies that operate in the oil industry is that their market value is closely associated with global oil prices.

That is to say, when oil prices are high – as they have been for some time now, companies involved in exploration and production will benefit from more favorable profit margins.

However, when oil prices are low – oftentimes companies in this sector will need to operate below the break-even point.

Oil Penny Stocks

The 10 oil stocks that we discussed earlier are also classified as large-cap companies. However, there is also an abundance of oil penny stocks that possess both a low share price and market capitalization.

According to the SEC, a penny stock is a publicly-traded company with a share price of below $5. The upside potential on oil penny stocks can be huge – albeit, so are the risks.

Nonetheless, if you’re in the market for the best oil penny stocks to buy right now – consider the firms outlined below:

  • Enquest – This oil penny stock is a UK-based exploration and production firm. As of writing, Enquest carries a market capitalization of under $600 million, so there is plenty of upside on the table. Over the prior year of trading, Enquest stock is up 74%.
  • Gran Tierra Energy – This penny stock specializes in the exploration and development of both oil and gas. The vast bulk of its operations are based in Ecuador and Colombia. Although several of the firm’s key operational hubs have faced ongoing protests recently, its stocks are up 127% over the prior 12 months.
  • Tetra Technologies – This penny stock provides core services to companies operating in the oil and gas industries. Over the prior 12 months, Tetra Technologies’ stock is up 45%.

Don’t forget – penny stocks – especially those in the oil industry, are extremely volatile. As such, ensure that you do plenty of research into the company and if possible – avoid stocks that trade over-the-counter.

Where to Buy Oil Stocks

Wondering how to trade oil? At this stage of our guide, you should now have a firm grasp of which oil stocks are suitable for your investment portfolio and long-term goals. If so, the next thing to consider is where to buy oil stocks.

Your chosen platform should give you access to the oil stocks you seek to add to your portfolio at competitive fees. If the platform offers fractional shares, this is an additional perk as it means you can buy the best dividend stocks as well as the hottest oil stocks with a minimum investment of just $10.

Overall, we found that eToro is the overall best place to buy oil stocks – and here’s why:

1. eToro – Overall Best Place to Buy Oil Stocks

eToro is our pick for the best online stock broker for retail client investors. The platform is home to more than 3,000 stocks in total – across more than a dozen exchanges and markets. This includes all of the 10 oil stocks that we analyzed today. The best part is you can buy stocks on eToro with a minimum investment of just $10. This means you can gain exposure to the most expensive stocks on the market via fractional share trading. 

Supported markets include the US, UK, Hong Kong, Germany, and more. Regardless of whether you are buying US or foreign companies, eToro allows you to buy and sell oil stocks at 0% commission. Furthermore, each and every oil stock hosted on the eToro website can be purchased from just $10.  

This is because eToro is a proponent of fractional shares. To find your oil stock investments, you only need to meet a minimum deposit of $10. Moreover, if you’re based in the US, you can deposit funds for free. This can be achieved via a debit or credit card, Paypal, Neteller, ACH, online banking, and several other convenient payment methods.

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Another thing to note is that when you invest in oil stocks that pay dividends – most of which do, your share of any payments will be deposited directly into your eToro account. You can then reinvest your dividends back into the oil industry or request a withdrawal. If you’re looking to diversify your portfolio, eToro also supports hundreds of commission-free ETFs.

This is inclusive of the SPDR S&P Oil & Gas Exploration & Production ETF and the United States Oil Fund. You can also mirror the buy and sell positions of other eToro investors via the copy trading feature. This promotes passive investing, as the only thing you need to do is choose a verified trader that aligns with your goals.

eToro also offers professionally managed portfolio services. In what it calls smart portfolios, this enables you to gain exposure to a variety of industries – such as oil, in a passive nature. We also like eToro for its popular crypto exchange – which enables you to buy Bitcoin and dozens of other leading digital currencies.

What We Like:

  • Buy oil stocks at 0% commission
  • Minimum deposit is only $10
  • Offers one of the best stock apps on the market
  • Regulated by numerous top-tier entities
  • Accepts credit/debit card and PayPal deposits
  • User-friendly trading app
  • Copy trading tools

Your capital is at risk. 68% of retail investor accounts lose money when trading CFDs with this provider.

Conclusion

Global commodity prices are booming and as such – now could be a great time to add some of the best oil stocks to your portfolio. Not only are oil shares doing well – but companies operating in this space typically have a solid dividend program in place.

To buy oil stocks right now at 0% commission and from a minimum investment of just $10 per trade – you can open an account with eToro and deposit funds fee-free in less than five minutes.

Your capital is at risk. 68% of retail investor accounts lose money when trading CFDs with this provider.

Frequently Asked Questions on Oil Stocks

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