Brent and West Texas Intermediate (WTI) crude oil prices are nearing their highest levels in a decade, driven largely by escalating tensions between the U.S./Israeli alliance and Iran. Chevron (CVX), as the third-largest energy company globally, has emerged as a significant beneficiary of this surge, with its stock performance closely tied to oil prices. Despite substantial year-to-date gains, questions arise about Chevron’s attractiveness as a buy.

Chevron remains highly profitable even with oil prices above $100 per barrel, maintaining a breakeven level below $50. The company has consistently increased its dividend for 39 years while reducing capital expenditure guidance, leading to robust earnings growth projected at a minimum of 10% annually. With strategic advantages in natural gas production and new opportunities in Venezuela and Guyana, Chevron is well-positioned for the long term.

For investors, the key takeaway is that while Chevron’s valuation has risen alongside its stock price, its strong fundamentals and growth potential make it a compelling option for long-term investment in the energy sector.

Source: fool.com