Most Canadian investors are well aware that oil prices are once again shooting to the moon. As a culmination of geopolitical tensions boiling over in the Middle East, supply disruptions through critical chokepoints like the Strait of Hormuz, and global demand holding firm despite whispers of a slowdown, this sector is primed for outsized gains.
For investors looking to take advantage of where oil prices have already gone so far in 2026, and where oil prices could be headed over the medium-term, there are a few ways to play this trend. I’m going to cover a few top energy stocks I think can outperform right now, and why the energy sector overall is one worth considering.
Where could oil prices be headed?
Oil prices have already spiked from the $70s to more than $100 per barrel recently. Unfortunately for consumers and those concerned about inflation, I see clear catalysts pushing them even higher. Personally, I think we’ll see $120 oil in short order, and I am not dismissing expert opinions that we could be seeing $200 oil in the near term.
Why the surge? Start with the headlines screaming from every financial feed. Escalating U.S.-Iran frictions and regional instability have traders on edge. History shows regime changes or conflicts in major producers like Iran trigger average crude spikes of 76% from disruption to peak.
We’re seeing that play out now, with Brent crude retracting only modestly after hitting $120 earlier this month. Even as world powers release strategic reserves for short-term relief, analysts agree this is a band-aid. I think volatility will persist, and prices will stay elevated as factions vie for control in Iran, disrupting 20% of global oil exports.
How to invest in this trend right now?
The good news for Canadian investors is that there is a plethora of world-class energy stocks to choose from that can provide amplified upside to these trends.
Enbridge (TSX:ENB) is among my top dividend stock picks for investors looking to play this trend defensively.
The company’s secure cash flows, driven by long-term volume-based contracts provide stability in times of rising (and declining) oil prices.
Then we have Suncor Energy (TSX:SU), with its integrated model and massive oil sands leverage.
Currently up 25% YTD already, I think there’s still room for Suncor to double, if oil can hold its triple-digit levels for a sustained period.
Or, investors could opt for Canadian Natural Resources (TSX:CNQ), a major oil player that cranks out low-cost barrels with impeccable balance sheet strength.
These aren’t speculative junior companies in the energy sector. I’m focsued on top-shelf blue-chips names positioned to ride the wave of oil prices higher for the remainder of 2026.
