Since topping out at $120 in the summer of 2022, the major oil benchmarks had traded down every month until bottoming at the beginning of December. The decline from the top in June of 2022 was a staggering 40%, and while the oil majors can still make money at that level, with a declining price, many opted to slow or halt production. By March of 2023, West Texas Intermediate had dropped to $67.61, a bottom that remained until late June when oil broke out.
After the breakout and move to over $90 per barrel, oil hit a wall in late September and dropped 22% before starting higher. This is despite war breaking out in the Middle East after the devastating Hamas attack on Israel.
Now that war is starting to expand, there are worries that Iran could become involved as Israel turns its attention to Hezbollah, which they have. If oil supplies are threatened in the region, prices could explode higher.
We screened our 24/7 Wall St. energy database for ultra-yield energy dividend stocks on sale and found six stocks investors should buy now. All are rated Buy across Wall Street.
Civitas Resources
Trading at an incredibly cheap 5.12 times estimated 2024 earnings with a huge 10.22% dividend, this could be a total return gem for 2024. Civitas Resources Inc. (NYSE: CIVI | CIVI Price Prediction) is an exploration and production company focused on the acquisition, development, and production of oil and natural gas in the Rocky Mountain region, primarily in the Wattenberg Field of the Denver-Julesburg Basin of Colorado.
Last October, Civitas signed an agreement with Vencer Energy to acquire oil-producing assets in the Midland Basin of west Texas for a total consideration of approximately $2.1 billion, subject to customary terms, conditions, and closing price adjustments. The Acquisition closed in Lanuary.
Energy Transfer
The top master limited partnership is a safe way for investors looking for energy exposure and income, as the company pays a massive 9.06% distribution. Energy Transfer LP (NYSE: ET) owns and operates one of the largest and most diversified portfolios of energy assets in the United States, with a strategic footprint in all of the major domestic production basins.
The company is a publicly traded limited partnership with core operations that include:
- Complementary natural gas midstream
- Intrastate and interstate transportation and storage assets
- Crude oil, natural gas liquids (NGL), and refined product transportation and terminalling assets
- NGL fractionation and various acquisition and marketing assets
Energy Transfer owns and operates more than 114,000 miles of pipelines and related assets in all significant U.S.-producing regions and markets across 41 states, further solidifying its leadership position in the midstream sector.
Through its ownership of Energy Transfer Operating, L.P., the company also owns Lake Charles LNG Company, as well as the general partner interests, the incentive distribution rights, and 28.5 million standard units of Sunoco LP (NYSE: SUN), and the public partner interests and 39.7 million standard units of USA Compression Partners, LP (NYSE: USAC).
MPLX
This company is one of the top holdings in the Alerian MLP energy exchange-traded fund, paying shareholders a strong 9% dividend. MPLX LP. (NYSE: MPLX) is primarily engaged in transporting crude oil and refined products and terminating in the US Midwest and Gulf Coast regions and natural gas gathering and processing in the northeast. Independent US refiner Marathon Petroleum Corp (NYSE: MPC) formed MPLX.
The company’s assets include:
- Network of crude oil and refined product pipelines
- Inland marine business
- Light-product terminals
- Storage caverns
- Refinery tanks
- Docks
- Loading racks and associated piping
- Crude and light-product marine terminals
MPLX also owns crude oil and natural gas gathering systems, pipelines, and natural gas and NGL processing and fractionation facilities in key U.S. supply basins.
Pioneer Natural Resources
This is a stock many Wall Street analysts love for a pure crude oil play that employs a variable dividend strategy and pays a massive 6.02% dividend. (NYSE: PXD) operates as an independent oil and gas exploration and production company in the United States. The company explores, develops, and produces oil, natural gas liquids (NGLs), and gas.
Pioneer production services are supported by 100 well-servicing rigs, more than 100 cased-hole, open-hole, offshore wireline units, and advanced coiled tubing units.
Last October, Exxon Mobil Corporation (NYSE: XOM) and Pioneer Natural Resources jointly announced a definitive agreement for ExxonMobil to acquire Pioneer. The merger is an all-stock transaction valued at $59.5 billion, or $253 per share, based on ExxonMobil’s closing price on October 5, 2023. Under the terms of the agreement, Pioneer shareholders will receive 2.3234 shares of ExxonMobil for each Pioneer share at closing. The implied total enterprise value of the transaction, including net debt, is approximately $64.5 billion.
Plains All American Pipeline
This stock has been locked in a tight trading range, looks ready to break out, and pays a fat 8.26% dividend. Plains All American Pipeline, L.P. (NYSE: PAA), through its subsidiaries, engages in the pipeline transportation, terminalling, storage, and gathering of crude oil and natural gas liquids (NGL) in the United States and Canada.
The company operates in two segments:
- Crude Oil
- Natural Gas Liquids (NGL).
The Crude Oil segment offers:
- Gathering and transporting crude oil through pipelines
- Gathering systems
- Trucks, barges, or railcars
This segment provides terminalling, storage, and other facilities-related services and merchant activities
The Natural Gas Liquids segment provides:
- Gathering
- Fractionation
- Storage
- Transportation
- Terminalling activities
This segment also involves ethane, propane, normal butane, iso-butane, natural gasoline, and crude oil refining processes.
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