Analysts Pick Energy Stocks Amid Conflict
As geopolitical conflict rattles energy markets, analysts are recommending a focus on North American assets to mitigate risk. Top picks include upstream producer APA (Apache), refiner Marathon Petroleum (MPC), and midstream operator Enterprise Products Partners (EPD), which are noted for strong performance and stable cash flow.
The recent escalation of conflict between a U.S.-Israeli coalition and Iran, particularly around the Strait of Hormuz, has injected significant volatility into global energy markets. This chokepoint is critical, with roughly 20% of the world's daily oil supply passing through it. In early March, oil prices spiked by about 8-12%, while European natural gas prices jumped 20% in response to the hostilities. The pivot to North American energy assets is a direct response to these overseas disruptions. The United States has been a net energy exporter since 2019 and is the world's largest producer of oil and gas, providing a degree of insulation from foreign supply shocks. This strategic flexibility is amplified by a major expansion of U.S. Liquefied Natural Gas (LNG) export capacity, positioning it as a key supplier to international markets. Refiners like Marathon Petroleum (MPC) are gaining attention after a strong 2025, a year in which the refining sector broadly outperformed upstream producers. Marathon recently reported quarterly earnings that surpassed analyst estimates and maintains a "Moderate Buy" consensus rating from brokerages. On March 7, 2026, Wall Street Zen upgraded the stock from a "hold" to a "buy" rating. Midstream operators such as Enterprise Products Partners (EPD) are favored for their business model, which relies on fee-based cash flows that offer more stability during commodity price swings. EPD has a track record of rewarding investors, having raised its dividend for 28 consecutive years. Following its Q4 2025 earnings, Stifel maintained a "Buy" rating and increased its price target for EPD to $41. Upstream producer APA Corp presents a more complex picture, with analysts holding a "Hold" consensus rating on the stock. While the company has been recognized for successful cost-cutting initiatives, it also carries geopolitical risk through its significant international operations in Egypt and Suriname. This exposure presents a notable contrast to the broader "North American safety" theme. Underlying the immediate geopolitical risks is a long-term structural trend: rising electricity demand from data centers and the expansion of artificial intelligence. This is driving the need for reliable energy sources and robust infrastructure, creating a durable demand backdrop for North American energy companies across all segments of the value chain.
