3 Energy Stocks That Could Benefit From Geopolitical Tensions

Key Points

• Energy stocks have lagged in 2025, but geopolitical tensions could shift supply-demand dynamics quickly.
• ExxonMobil and Chevron provide scale, dividends, and exposure to the Permian Basin for stability and upside.
• Baker Hughes offers leveraged exposure to rising oilfield activity if energy prices climb.

To the surprise of some investors, energy stocks  have quietly underperformed in 2025—especially oil and gas names.

Despite steady U.S. production under the Trump administration, efficiency gains and subdued global demand have kept energy prices in check, giving consumers the upper hand. Lower oil and gas prices have also been a bright spot as inflation remains sticky in other areas of the economy.

Yet, as history has shown, supply-demand dynamics can shift abruptly when geopolitical events disrupt markets. Investors need only look back to 2022, when Russia’s invasion of Ukraine sent oil prices soaring, or to 2025. And in 2025, U.S. military action against Iran’s nuclear infrastructure served as a stark reminder of how quickly energy supply chains can be disrupted.

In times like these, energy companies with scale, financial strength, and diversified operations tend to benefit most. These companies have the resources to withstand volatility and generate consistent cash flows that allow them to reward shareholders through dividends and buybacks.

Today, three energy blue chips stand out for their resilience and potential upside if geopolitical tensions escalate: Exxon Mobil Corporation NYSE: XOM, Chevron Corporation NYSE: CVX, and Baker Hughes NASDAQ: BKR.

Exxon Mobil: Dominance in Oil and LNG, with Shareholder Rewards

Thanks to its diversified global footprint and strong balance sheet, Exxon Mobil tops this list and remains one of the most reliable names in the energy sector. The company is a leading producer in the Permian Basin, one of the most productive oil fields in the world, giving it a cost advantage that supports profitability even when oil prices fluctuate.

Beyond the oil patch, Exxon Mobil heavily invests in liquefied natural gas (LNG). As Europe and parts of Asia reduce dependence on Russian and Middle Eastern supply, Exxon’s LNG infrastructure could benefit from shifting trade flows.

Beyond its diversified portfolio, Exxon Mobil offers tremendous shareholder value. In its most recent quarter, the company delivered $9.2 billion to shareholders with $5 billion of share repurchases. The company is also a dividend aristocrat with a yield above 3.4% and 42 consecutive years of dividend increases.

Chevron: Global Diversification and a Reliable Income

If Exxon Mobil is the leader in the oil and gas sector, Chevron is a strong 1B. The integrated oil giant offers investors many of the same advantages as its closest peer, but with its own strengths that stand out during periods of uncertainty.

For example, Chevron also has a significant presence in the Permian Basin, which was enhanced after its merger with Hess. The company’s low-cost operations provide a cushion against volatile commodity prices.

Chevron also has significant exposure to international projects, including LNG operations in Australia and significant upstream investments in Kazakhstan. This global diversification gives Chevron resilience against localized disruptions.

Financially, the company has maintained a conservative balance sheet, which allows it to fund shareholder returns through cycles. Like Exxon Mobil, Chevron is a dividend aristocrat, having increased its dividend for 38 consecutive years. As of this writing, the dividend yields 4.28%, making it one of the most attractive in the sector.

Baker Hughes: Oilfield Services with Upside Exposure

Baker Hughes is a name to watch if the supply-demand imbalance begins to swing towards the producers. As one of the world’s largest oilfield services companies, Baker Hughes provides the technology and equipment that enable exploration and production across the industry.

That makes the company directly a beneficiary of increased activity when energy prices rise and producers ramp up drilling. Baker Hughes also has a growing presence in digital technologies and emissions-reduction solutions, positioning it for relevance in the evolving energy mix.

Financially, the company has been improving margins and reducing debt, strengthening its ability to deliver consistent results. BKR stock is up 13% in 2025, but analysts are projecting earnings growth of over 15% in the next 12 months.

While Baker Hughes’ dividend yield is lower than its integrated peers, its payout is well-supported and supplemented by share buybacks. Producers will likely increase capital spending if geopolitical tensions push oil and gas prices higher, benefiting Baker Hughes’ order book.