3 Oil And Gas Stocks To Watch As Energy Prices Test Three Year Highs

Europe’s gas prices are back at three year highs and Brent crude is near $97, which is rippling through inflation expectations, bond markets and equity valuations. That mix of higher input costs and higher discount rates can punish some stocks while improving pricing power for others. This article walks through three global oil and gas producers exposed to this news to help you decide whether they belong on your watchlist or avoid list.

The stocks in the list below are just a sample, and the full screen surfaced 46 more large oil and gas companies with equally compelling narratives that are not covered here. If you want to quickly identify your own highest conviction ideas, head straight to the Global Oil & Gas Producers and Integrated Energy Majors screener to analyze, compare, and filter this wider set of producers and integrated majors.

TGS (OB:TGS)

TGS is a large Oslo based geoscience data provider that supplies seismic, well and subsurface information to oil and gas companies, which ties it directly to exploration and development budgets highlighted by this upstream focused screener theme. The bulk of its revenue comes from multi client seismic and related services at about $1 billion, with marine data acquisition contributing roughly $793 million and imaging around $127 million, reflecting a business heavily geared to hydrocarbon exploration workflows, with various internal adjustments and eliminations alongside. TGS has a market cap of roughly NOK27.1b, which places it firmly among the larger listed energy service stocks covered by this screen.

Investors looking at rising oil and gas prices may find TGS interesting because it sells the data that helps producers decide where to drill and how to allocate exploration capital. The company is pushing into higher margin imaging, AI driven subsurface tools and multi year seismic contracts in regions like Indonesia, the Mediterranean and Malaysia, which could help smooth cash flows and reduce reliance on one off library sales. At the same time, a premium valuation, a 4.2% dividend that is not well covered by earnings and an asset heavy approach tied to exploration budgets mean you are paying up for this exposure. The key question is whether that earnings growth and data demand can justify the higher risk profile investors are signing up for.

Accelerating data demand and premium pricing for TGS can look compelling, but the real story sits in how that risk reward trade off stacks up in the 3 key rewards and 2 important warning signs.

Patterson-UTI Energy (PTEN)

Patterson-UTI Energy is a large Houston based oilfield services company that sits squarely in the upstream part of the Global Oil & Gas Producers and Integrated Energy Majors theme, supplying drilling and completion services that E&P customers rely on when activity picks up. It generates most of its revenue from Completion Services at about $2.8b, followed by Drilling Services at roughly $1.5b, Drilling Products at around $341 million and Other Operations at about $25 million. With a market cap of roughly $4.8b, Patterson-UTI is a sizeable services stock geared to drilling and completions activity in oil and gas basins.

Investors seeking direct exposure to higher drilling and completion activity when oil and gas prices rise may want to study Patterson-UTI Energy more closely. The company has been leaning into higher spec rigs, automation and lower emission frac fleets, which can help it secure longer contracts and firmer pricing when customers want reliable equipment and efficiency gains. At the same time, Patterson-UTI is still working through a period of mixed profitability, high capital needs and a dividend that depends on a stronger earnings and cash flow profile. The key consideration is how this balance between demand for premium equipment, LNG driven gas drilling and funding and margin risks evolves over the next few years.

Rising activity, higher spec rigs and LNG linked gas drilling put Patterson-UTI Energy in an interesting spot, yet the full picture is more nuanced. Get the 2 key rewards and 2 important warning signs

Santos (ASX:STO)

Santos is one of the purest ways to play the Global Oil & Gas Producers and Integrated Energy Majors theme, with a portfolio of oil, gas and LNG projects that are directly linked to upstream prices. It earns about $2.4b from Papua New Guinea, $1.0b from Queensland and New South Wales, $735 million from Western Australia, $495 million from the Cooper Basin and $422 million from Northern Australia and Timor-Leste, with smaller corporate and exploration adjustments. With a market cap of roughly A$26.8b, Santos is a heavyweight in the Asia Pacific energy complex.

If you want direct exposure to rising oil and gas prices, Santos is hard to ignore. The company already has large LNG positions in Papua New Guinea and Northern Australia, and 2026 has brought fresh production from projects like Pikka in Alaska. All of these factors tie its earnings closely to the current gas and crude spike. At the same time, heavy spending on Barossa, Pikka and carbon capture, together with weaker free cash flow cover for the dividend and exposure to regulation in Australia, means execution risk is real. The more interesting question is how this mix of growth projects, LNG contracts and balance sheet pressure stacks up once you look past the headlines.

Accelerating LNG exposure and new production make Santos look like a pure play on today’s gas spike, but the real twist shows up once you read the analysis report for Santos

Seeking Fresh Alternatives Beyond Oil?

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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