Despite investors’ concerns over a potential decline in demand for oil and gas due to the resurgence of COVID-19 cases, the energy sector is likely to witness a boost in production as the U.S. government seeks measures to address rising gasoline prices. So, we think it could be clever to bet now on fundamentally strong energy stocks TotalEnergies SE (TTE), ConocoPhillips (NYSE:COP), and Fuel Gas Company (NFG) because they are well-positioned to capitalize on the industry tailwinds. Let’s discuss.Since several countries re-introduced travel restrictions due to a spike in COVID-19 cases, investors have been worried about the global demand for oil energy. However, the major oil-producing countries are curbing their supply cuts. But with gasoline prices surging last week, the Biden administration believes a recent OPEC+ agreement to increase output by 400,000 barrels per day was "simply not enough" and is in additional negotiations with the cartel and other oil-producing countries to increase production to curb rising prices.
According to a U.S. offshore regulator, discussions are underway to overturn the federal oil and gas leasing moratorium imposed earlier this year. Furthermore, impressive second-quarter earnings reported by the energy sector and increasing dividend distributions to the shareholders have fostered a positive outlook for the industry.
Therefore, we think it could be wise to bet on energy stocks TotalEnergies SE (TTE), ConocoPhillips (COP), and National Fuel Gas Company (NYSE:NFG) to cash in on the industry tailwinds.