Gas Prices Hit Record High: Snag These Top Energy Stocks Right Now

Canadians wrestling with soaring oil and gas prices should target energy stocks like Imperial Oil Ltd. (TSX:IMO)(NYSE:IMO) in early March.

| More on:

Russia launched a large-scale invasion of Ukraine on February 24, 2022. Intelligence sources in the United States and Europe had predicted that an invasion was imminent for many weeks. Still, the brutal reality of the aggressive act has stunned world opinion. On the date of the invasion, I’d discussed the spike in oil prices. The price of WTI crude soared above the US$130/barrel mark over the weekend. Meanwhile, prices at the pump have also surged to record highs. NATO and the European Union have applied major sanctions on the Russian state, threatening the global supply of oil and gas. In this environment, investors should look to some of Canada’s top energy stocks.

Why gas prices may be headed even higher in 2022

The U.S. and some of its allies are reportedly considering an all-out ban on Russian oil. This could vault the price of WTI crude above the US$150 mark and deliver even more punishment for consumers at the pump. Russia has shown no signs of pulling back on its aggression. On the contrary; reports suggest that it will intensify its shelling of major cities, as it looks to secure territory in the eastern part of Ukraine. Investors should prepare for long-term economic warfare between the two sides.

Here are two super energy stocks to pick up in this climate

Imperial Oil (TSX:IMO)(NYSE:IMO) is a Calgary-based company that is engaged in the exploration, production, and sale of crude oil and natural gas. Shares of this energy stock have climbed 27% in 2022 as of early afternoon trading on March 7. The stock has surged 96% in the year-over-year period.

The company unveiled its final batch of 2021 earnings on February 1. Imperial Oil achieved its highest annual upstream production in more than a quarter century in 2021. Net income rose to $2.47 billion compared to a net loss of $1.85 billion in 2020.

This energy stock possesses a favourable price-to-earnings (P/E) ratio of 17. It offers a quarterly dividend of $0.34 per share, which represents a 2.2% yield.

Suncor (TSX:SU)(NYSE:SU) is another top Calgary-based integrated energy company. This energy stock has shot up 25% so far in 2022. Its shares are up nearly 50% in the year-over-year period.

In Q4 2021, Suncor delivered adjusted funds from operations of $3.14 billion, or $2.17 per common share — up from $1.22 billion, or $0.80 per common share, in the previous year. Shares of this energy stock last had an attractive P/E ratio of 15. Moreover, it offers a quarterly dividend of $0.42 per share. That represents a solid 4% yield.

One more energy stock to buy as gas prices soar

Cenovus Energy (TSX:CVE)(NYSE:CVE) is another top oil and natural gas producer. This energy stock has increased 27% in the year-to-date period. Its shares are up 100% from the same period in 2021.

Investors got to see its fourth-quarter and full-year 2021 results on February 8. Cash from operating activities rose to $5.91 billion compared to $273 million in the previous year. Meanwhile, adjusted funds flow soared to $7.24 billion over $117 million in 2020. This energy stock remains a solid target, as it has soared to profitability on the back of rising oil and gas prices.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Ambrose O'Callaghan has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.

More on Energy Stocks

engineer at wind farm
Energy Stocks

Invest $20,000 in This Dividend Stock for $100 in Monthly Passive Income

This dividend stock has it all – a strong outlook, monthly income, and even more to consider buying today.

Read more »

A worker overlooks an oil refinery plant.
Energy Stocks

Is Imperial Oil Stock a Buy, Sell, or Hold for 2025?

Valued at a market cap of $55 billion, Imperial Oil pays shareholders a growing dividend yield of 2.4%. Is the…

Read more »

Pumpjack in Alberta Canada
Energy Stocks

Where Will Imperial Oil Stock Be in 1 Year?

Imperial Oil is a TSX energy stock that has delivered market-thumping returns to shareholders over the last two decades.

Read more »

Pumpjack in Alberta Canada
Energy Stocks

1 Magnificent Energy Stock Down 17% to Buy and Hold Forever

Down over 17% from all-time highs, Headwater Exploration is a TSX energy stock that offers you a tasty dividend yield…

Read more »

Pumpjack in Alberta Canada
Energy Stocks

Is Cenovus Energy Stock a Good Buy?

Cenovus Energy (TSX:CVE) stock is primed for capital gains and strong total returns in 2025, driven by strategic buybacks and…

Read more »

Trans Alaska Pipeline with Autumn Colors
Energy Stocks

2 High-Yield Dividend Stocks That are Screaming Buys Right Now

Natural gas stocks like Peyto Exploration and Development are yielding above 7% today and look undervalued as natural gas strengthens.

Read more »

chart reflected in eyeglass lenses
Energy Stocks

Best Stock to Buy Right Now: Canadian Natural Resources vs Cenovus?

Want to invest in Canadian energy? Canadian Natural Resources and Cenovus Energy are two of the largest, but which one…

Read more »

oil pump jack under night sky
Energy Stocks

Where Will Cenovus Stock Be in 1/3/5 Years? 

Let's dive into whether Cenovus (TSX:CVE) stock is worth buying right now and where this stock could be headed over…

Read more »