Energy Stocks Tied to Higher Oil and Fuel Prices Gain Attention

The recent surge in oil and fuel prices has brought inflation back into focus. This increase in costs can have a significant impact on businesses, especially those that rely heavily on energy. To navigate this environment, investors may want to consider stocks tied to the energy sector.

Three U.S. energy stocks, Natural Gas Services Group (NGS), Cactus (WHD), and RPC (RES), are closely linked to higher oil and fuel prices. These companies have a strong presence in the energy market and can potentially benefit from increased prices.

Natural Gas Services Group supplies compression equipment that keeps gas volumes flowing when producers lean into stronger commodity economics. The company generates most of its revenue from rental compression equipment, with smaller contributions from aftermarket services and sales. However, persistent labor shortages and input cost inflation may erode operating efficiencies and weigh on net earnings over time.

Cactus is closely tied to the U.S. Energy Sector Beneficiaries of Higher Oil and Fuel Prices theme due to its pressure control gear and spoolable pipe, which are directly linked to drilling and production activity when crude remains expensive. The company has a sizeable footprint in equipment and pipe that serve onshore oil and gas activity.

RPC plugs directly into the higher-oil-price story by providing pressure pumping, cementing, and rental tools that support U.S. drilling and well work. Technical Services generate about $1.7b of its roughly $1.8b revenue, with Support Services adding around $89 million.