Oil Stocks To Watch If Strait Of Hormuz Tension Pushes Energy Prices Higher

Geopolitical tension in the Strait of Hormuz has quickly shifted from headline risk to a real concern for global energy flows, with around 20% of the world’s energy moving through this narrow route. For energy sector stocks, particularly those tied to oil, gas, and related infrastructure in markets like the US, UK, Canada, and Australia, this kind of disruption risk can reshape pricing power, costs, and investor sentiment. This article explains how that backdrop could matter for your portfolio and introduces 3 stocks from our Energy Sector Stocks screener that appear positively exposed to the latest developments.

Devon Energy (DVN)

Overview: Devon Energy is a US based independent producer of oil, natural gas, and natural gas liquids, with a portfolio of shale assets across the Delaware, Eagle Ford, Anadarko, Williston, and Powder River basins. Founded in 1971 and now headquartered in Houston, the company focuses on finding and extracting hydrocarbons from these key regions.

Operations: Devon Energy generates about US$16.0b in revenue from oil and gas exploration and production activities, all from operations in the United States.

Market Cap: US$50.5b

Devon Energy stands out in the current Strait of Hormuz tension because it is a large, US focused producer that is highly sensitive to crude prices, yet it is not directly reliant on shipping oil through that chokepoint. The company combines sizeable US shale assets in the Delaware Basin with a focus on free cash flow, cost control, and capital returns, including a sizeable buyback program and a higher fixed dividend. At the same time, investors need to weigh heavy shale exposure, high debt, dilution, insider selling, and board turnover, along with ongoing activist pressure and regulatory questions. How those pieces come together in terms of valuation, cash returns, and risk is where the Devon Energy story becomes more complex.

Devon Energy’s buybacks, higher fixed dividend, and focus on free cash flow could be masking a sharper story about risk and reward, and the 3 key rewards and 4 important warning signs (1 is major!) might be where that story really turns

Matador Resources (MTDR)

Overview: Matador Resources is a US based independent oil and natural gas company that focuses on acquiring, drilling, and producing hydrocarbons in the Delaware Basin, with additional activity in the Haynesville shale and Cotton Valley plays, and also owns midstream assets that move, process, and dispose of oil, gas, and produced water for itself and third parties.

Operations: Matador Resources generates about US$3.2b from Exploration and Production and US$739.2m from Midstream operations, partly offset by US$392.5m of consolidations and eliminations, with all US$3.6b of revenue coming from the United States.

Market Cap: US$6.6b

Matador Resources is a US onshore producer that is closely linked to oil prices at a time when tensions around the Strait of Hormuz are raising concerns about global supply. It also has a growing midstream arm that can generate more stable, fee based income. The company is currently priced at what some see as a deep discount to estimated fair value and carries analyst expectations for strong earnings growth, but it also faces high capital needs, a recent swing to a quarterly loss, and a relatively new management team. To examine how those strengths and risks balance out in terms of valuation, balance sheet, and future cash flow, the detailed analysis report for Matador Resources provides deeper insight beyond the headline numbers.

Matador Resources looks like a valuation story that many investors may be treating as yesterday’s trade, yet the full analysis report for Matador Resources hints at one key swing factor that could change how the whole setup is viewed.

Imperial Petroleum (IMPP)

Overview: Imperial Petroleum is a Greece based shipping company that owns and operates a mixed fleet of tankers and drybulk vessels, moving crude oil, refined products such as gasoline and jet fuel, edible oils, chemicals, and dry commodities like iron ore, coal, grains, and fertilizers for producers, refiners, traders, and industrial users around the world.

Operations: Imperial Petroleum generates about US$190.6m in revenue from transportation and shipping services, all reported from Greece.

Market Cap: US$208.4m

Imperial Petroleum sits at the crossroads of current Strait of Hormuz tensions, with a fleet of crude and product tankers that can benefit when trade routes are disrupted, insurance costs jump, and charter rates move higher, as management has highlighted in recent calls. Earnings have been strong, with Q1 2026 net income of US$28.0m on sales of US$61.7m. Analysts point to revenue and earnings growth supported by a low P/E and a history of profitability. At the same time, heavy reliance on external funding, recent shareholder dilution, and exposure to shorter term charters mean any downturn in freight rates or regulatory burden could have a significant impact on results, which is why understanding the full risk and reward trade off is important.

Imperial Petroleum’s strong recent earnings and mixed tanker fleet could be masking a bigger story about volatility, funding and freight rates, and the 4 key rewards and 1 important major warning sign might reveal the twist investors are missing

The 3 stocks in this article are only a starting point, and the full Energy Sector Stocks screener surfaces 33 more energy companies that carry equally compelling narratives around supply risk, pricing power, and capital discipline. Use Simply Wall St to analyze these ideas further so you can identify the specific catalysts, risk profiles, and cash flow stories that best fit your highest conviction energy plays.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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