Canadian energy stocks could experience another drawn surge as crude oil prices touch triple-digit price levels — again. As conflict rages in the Middle East, the world’s largest crude oil price benchmark, Brent Crude, surpassed the US$ 100-a-barrel mark early Wednesday morning, up from recent lows around US$70 a barrel seen in early July 2026. Brent crude is responsible for the pricing of about 80% of the physical global oil trade.
Closer to home, the West Texas Intermediate (WTI) crude oil benchmark at US$95 a barrel was following closely behind Brent, promising huge returns to top Canadian oil producers as barrels fetch higher prices, profits grow again, and free cash flow to equity investors surges. Here are two Canadian energy stocks I’d buy before the crude oil rally runs further.
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Canadian Natural Resources (CNQ) stock
If you follow a long-term buy-and-hold investment strategy that appreciates the long-term compounding power of well-positioned Canadian energy stocks as oil prices remain firm, Canadian Natural Resources (TSX: CNQ) is the TSX energy stock to consider buying first as crude reclaims triple-digit prices — again.
The $147 billion CNQ stock is a senior crude oil and natural gas production company, with low-cost, low-decline oil assets in Western Canada, that are supported by diversified production from the North Sea and Offshore Africa. The energy stock does very well when oil prices surge, and its management teams reward investors even better as corporate cash coffers pile up during oil booms.
CNQ is a low-decline cash flow-printing asset that should translate US$100 of crude directly into expanding quarterly dividend payouts, special dividends, and amplified stock repurchases while capital gains accrue as it deleverages its balance sheet.
A $100 crude oil price, sustained for longer, may enable CNQ to quicken its debt reduction plan, which is quickening the company’s realization of its $13 billion net debt target.
This is key.
Canadian Natural Resources’s net debt has declined from $17 billion in June 2025 to $14.5 billion by mid-year this year. Once CNQ reaches a $13 billion net debt level, management intends to allocate 100% of free cash flow (after base dividends) towards shareholder returns. This means more special dividends and increased share repurchases that support sustained capital gains on the Canadian energy stock.
The current quarterly dividend (base dividend) yields 3.6% annually. CNQ stock has raised its base dividends every year for 26 consecutive years now. The dividend champion has averaged a 20% compound annual growth rate (CAGR) during the 26-year period.
The energy stock has generated 77% in total returns over the past 12 months, and it trades at a respectable forward price-to-earnings (P/E) of 13.2.
Athabasca Oil (ATH) stock
Athabasca Oil (TSX: ATH) stock should offer Canadian investors a pure-play heavy oil leverage as oil prices surge again in 2026. While it doesn’t pay any regular dividends, Athabasca Oil stock may experience a good rally if oil prices hold above $100 for longer.
The timing of a late-2026 oil surge collides well with Athabasca’s recent production expansion investments at Leismer and McMurray (the Corner project) that will grow its productive capacity next year. Higher oil lowers the cost of growth funding as Athabasca uses more of its internally generated cash flow to finance its expansion (leaving a new $500 million credit facility largely untouched). New production growth may fetch higher prices in 2027, accelerating returns on capital deployed.
Most noteworthy, Athabasca operates on a net-cash position. Its balance sheet is strong. And high oil prices should make it even stronger.
There’s heavy insider buying on ATH stock lately, a trend that has persisted during the past 12 months. The major purchaser of ATH is the issuer itself. Management appears convinced the Canadian energy stock is undervalued on the public markets, and Athabasca has repurchased more than 950,000 of its own shares during the past three months alone, worth nearly $10 million.
The energy stock printed new 52-week highs at $12.84 when oil prices surged earlier this year. It exchanges hands around $11 at writing. Perhaps it may reclaim prior highs if oil sustains its recent rally.
ATH stock trades at a forward P/E of 12.4, and a forward price-earnings-to-growth (PEG) ratio of 0.7 implies the TSX energy stock could be undervalued given its earnings growth potential. This is despite a 1,350% capital gain during the past five years.
