Diamondback Energy (FANG) and Valero Energy (VLO) have seen notable stock gains in 2026, driven by escalating tensions in the Gulf and rising oil prices. Both companies are positioned to benefit from these macroeconomic shifts, with Diamondback focusing on the lucrative Permian Basin and maintaining a commitment to returning cash to investors through dividends and share buybacks. The company’s $4.20 dividend is well-supported by hedging strategies, ensuring stability even if oil prices dip below $37 per barrel.

Valero, a petroleum refiner, faces a more complex landscape as high oil prices can pressure profit margins. However, the current spike in the “crack” spread—now exceeding $47—indicates a favorable environment for refiners, especially if geopolitical tensions disrupt supply chains. Valero’s operational focus on U.S. crude oil positions it advantageously amid potential supply constraints.

For market professionals, the key takeaway is that both Diamondback and Valero may offer more than just short-term tactical plays; their fundamentals suggest potential for sustained growth amid ongoing geopolitical uncertainties.

Source: fool.com