Oil could stay above $100 for the rest of 2022 — here are 3 easy ways to make money if that happens

There's a chance oil could stay above $100 for the rest of 2022 due to three things: Demand, supply, and production.

Demand for crude oil is rebounding as the global economy recovers — people are traveling and commuting again. Meanwhile, production has failed to meet that demand because producers have underinvested for nearly a decade. On top of that, sanctions on Russia have cut supply from one of the world’s largest energy exporters. Earlier this year, Goldman Sachs even called for oil prices to continue rising above $100 in 2023.

Here are three top oil stocks that benefit from those dynamics.

Chevron

Investment legend and Berkshire Hathaway CEO Warren Buffett recently revealed a massive stake in Chevron. In fact, the oil and gas gorilla is now Berkshire’s fourth-largest publicly traded holding.

Chevron is at the forefront of the energy boom. In 2021, it produced a total of over 1.8 million barrels of oil and natural gas liquids per day. Meanwhile, the company’s free cash flow has surged by more than 1,000% to $21.1 billion over the past year.

Currently, the stock trades at a price-to-cash flow ratio of 10. It also offers a healthy 3.5% dividend yield.

Occidental Petroleum

Occidental Petroleum is another big energy bet in Buffett’s portfolio. The Oracle of Omaha added this new position at the start of 2022. Year to date, the stock is up about 97%, so it has worked out well for the billionaire.

Occidental is the largest acreage holder in the highly coveted Permian Basin, with assets concentrated in West Texas and Southeast New Mexico. The company generates a healthy amount of free cash flow — $9.2 billion in 2021 — much of which gets handed back to investors in the form of dividends and buybacks.