The recent attack on Iran by the U.S. and Israel could fuel higher oil prices. WTI crude recently crossed above $77 per barrel in the United States, and may continue to rise in the event of a prolonged conflict in the Middle East.
In the meantime, income investors can find strong dividend yields in the energy sector. The following 3 Big Oil stocks are attractive for dividend investors because of their steady dividend increases along with market-beating yields.
Occidental Petroleum (OXY)
Occidental Petroleum is an international oil and gas exploration and production company with operations in the U.S., the Middle East, and Latin America. While the company also has a midstream segment, it is much more sensitive to the price of oil than the integrated oil majors.
On October 2nd, 2025, Occidental agreed to sell its chemical business to Berkshire Hathaway for $9.7 billion in cash. The funds will be used by Occidental to pay off $6.5 billion of debt and reduce its annual interest expense.
In mid-February, Occidental reported (2/18/26) results for the fourth quarter of 2025. Its production edged up 1% over the prior quarter while its realized prices of oil and gas decreased materially. As a result, earnings-per-share plunged 52%, from $0.64 to $0.31, though they exceeded the analysts’ consensus by $0.13.
Occidental grew its reserves from 4.0 to 4.6 billion in 2024 thanks to the acquisition of CrownRock but its reserves remained essentially flat in 2025. Due to its high debt, Occidental is sensitive to oil and gas prices.
Occidental has greatly increased its production in the Permian Basin in recent years. The reserve replacement ratio of 230% in 2024 (organic ratio of 112%), which boosted reserves from 4.0 to 4.6 billion barrels, bodes well for future growth of output.
OXY has increased its dividend for 5 consecutive years, and shares currently yield 1.9%.
Diamondback Energy (FANG)
Diamondback Energy develops and explores onshore oil and natural gas reserves in the Permian Basin. The profits of the company are extremely sensitive to the prices of oil and gas.
In late February, Diamondback Energy reported (2/23/26) financial results for the fourth quarter of fiscal 2025. The average realized prices of oil and gas decreased significantly over the previous quarter.
As a result, earnings-per-share decreased -44%, from $3.08 to $1.74, and missed the analysts’ consensus by $0.26.
Management provided guidance for average production of 926,000-962,000 barrels per day in 2026, implying 2.5% growth at the mid-point.
Diamondback Energy grew its proved reserves 2% in 2025, on top of 63% growth in 2024, 7% growth in 2023 and 14% growth in 2022. This certainly bodes well for future production growth.
Over the past several years, Diamondback Energy has posted strong earnings-per-share during periods of high oil prices. Diamondback’s breakeven point is around $33 per barrel.
The low dividend payout ratio of 38% is likely to provide a wide margin of safety for the dividend for the foreseeable future. FANG has increased its dividend for 9 consecutive years and the stock currently yields 2.3%.
Exxon Mobil (XOM)
Exxon Mobil is a diversified energy giant with a market capitalization above $600 billion. In 2025, the upstream segment generated 74% of the total earnings of Exxon while the downstream and chemical segments generated 23% and 3% of the total earnings, respectively.
In late January, Exxon reported (1/30/26) financial results for the fourth quarter of fiscal 2025. Production grew 5% sequentially thanks to the start-up of many projects but the price of oil decreased significantly. As a result, earnings-per-share decreased -9% sequentially, from $1.88 to $1.71. The price of oil has remained below $70 in the last six months, as OPEC has begun to unwind its production cuts and global economy has decelerated.
Consequently, annual earnings-per-share declined -10%. Exxon repurchased $69 billion of shares in 2022-2025 and intends to repurchase $20 billion of shares this year.
Exxon is expecting meaningful production growth until 2027 and a much lower breakeven point thanks to the addition of exceptionally low-cost barrels. The recent acquisition of Pioneer will be a major growth driver of Exxon, which now expects to reach production of about 2.0 million barrels per day in the Permian Basin by 2027.
Guyana, one of the most exciting growth projects in the energy sector, is the other major growth project of Exxon. Exxon has more than tripled its estimated reserves in the area, from 3.2 billion barrels in early 2018 to about 11.0 billion barrels now.
XOM has increased its dividend for over 40 years and shares currently yield 2.7%.
Disclosure: No positions in any stocks mentioned
