One thing is for sure, despite bearish claims that oil can go to $20 and below, the miles being driven in developed countries by cars and trucks has continued to grow for the past 20 years. Toss in a gigantic population in China also taking to the roads and demand will continue to be in place.

In a new research note, Cowen thinks that the “lower for longer” scenario has been accepted by investors and oil will stay range-bound in the $35 to $55 range for the rest of 2015. The firm also advises that three top companies are the best defensive stocks to buy, and they offer the best risk/reward scenario for now. All three are rated Outperform at Cowen

Anadarko Petroleum

This stock routinely shows up across Wall Street as a top stock to buy in the energy sector. Anadarko Petroleum Corp. (NYSE: APC) is one of the world’s largest independent exploration and production companies, with efforts in all major domestic drilling areas, as well as in South America, Africa, Asia and New Zealand.

Anadarko reported very solid earnings numbers on stronger production and lower exploration costs. Revenue was posted at $2.64 billion in the most recent period, surpassing Wall Street forecasts. The reported second-quarter profit was $61 million. Earnings, adjusted for non-recurring gains, came to $0.01 per share. With liquids growing as a greater percentage of the overall business, and savings being redeployed to add more wells, the analysts feel the stock remains a compelling buy.

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Anadarko investors are paid a 1.67% dividend. The Cowen price target for the stock is $87. The Thomson/First Call consensus target is higher at $90.03. The stock closed Tuesday at $64.81.

Occidental Petroleum

This is another top energy stock, and one of the high-yielding domestic stocks in the energy sector. Occidental Petroleum Corp. (NYSE: OXY) announced last year it will continue to grow dividends and expects to begin buying back more shares this year and beyond, a double plus for shareholders.

Analysts feel that Occidental still faces the rebounding oil price correction with the strongest balance sheet in the sector, with net cash at year-end 2014 estimated at around $1.7 billion and a whopping $11 per share of cash available for buy backs. With chemicals and other products helping to blunt the drop in oil, the company is well positioned to continue to ride out the storm.

This is also another company taking advantage of huge cost savings. In fact, capital expenditures are expected to fall from $1.7 billion to $1.0 billion by the end of the year. Occidental announced recently a deal with Ecopetrol to invest up to $2 billion over the next decade to increase production at the La Cira-Infantas oil field in Colombia. According to reports from Reuters, the new round of investments will increase production in the region by more than 200 million barrels.

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Occidental shareholders are paid an outstanding 4.58% dividend. The Cowen price target is $84, and the consensus target is $82.22. The stock closed on Tuesday at $65.76.

Cimarex Energy

This is a top play for investors looking to the Permian Basin. Cimarex Energy Co. (NYSE: XEC) is an independent exploration and production company. The company is focused on increasing shareholder value through strategies linked to generating attractive economic returns on capital employed and profitable growth in per-share reserves, production and cash flow. It intends to profitably grow reserves and production through a balanced mix of exploration, exploitation and acquisitions.

Cimarex has a diversified base of high-quality production and attractive drilling opportunities, and it should be closing on a huge oil and gas asset sale soon. It should be noted that hedge fund gurus Steve Cohen and George Soros initiated sizable new position in the company recently.

Investors are paid a small 0.6% dividend. The Cowen price target is $130. The consensus target is set at $128.36. The shares closed most recently at $103.65.

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This is an ugly market for sure, but the time to add shares or initiate positions is now, not when things start to look up in 2016 and beyond. Investors may want to scale in shares slowly, to buy partial positions now and see if the market doesn’t take a final flush down.

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