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3 Stocks to Buy as Energy Prices Heat Up By StockNews

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© Reuters. 3 Stocks to Buy as Energy Prices Heat Up

Sandridge Energy (SD), Canadian Natural Resources (NYSE:), and Sunoco LP (SUN) are 3 energy stocks that are attractive on a fundamental basis. Further, the outlook for oil remains positive due to lower production and a surge in demand this summer.We’re seeing strength in commodities across the board. In fact, a handful are making new, all-time highs such as , iron ore, and lumber. Even the laggards are starting to move higher such as , gasoline, and .

The factors driving strength in these assets are pretty similar. The coronavirus resulted in significant production disruptions, and many companies aggressively cut costs including capital expenditures to preserve cash. Like the rest of the world, they anticipated a meaningful time period in which demand would remain weak. However, demand did not drop as much as anticipated and for many commodities – it’s now higher than it was in 2019.

Of course, a contributing factor is that the previous bear market in energy has led many companies to be hesitant about taking on more debt and invest significantly in new production. Prices may have to go much higher before supply starts increasing. Thus, in the intermediary, energy prices could have significantly more upside in the coming months. To take advantage of this, investors should consider investing in these 3 energy stocks: Sandridge Energy (SD), Canadian Natural Resources (CNQ), and Sunoco LP (SUN).

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