Want Decades of Passive Income? 2 Oil Stocks to Buy Right Now.

If you're looking for a reliable source of passive income that can last for decades, consider investing in oil stocks. The oil industry has been volatile in recent years, but two companies stand out as reliable dividend stocks with strong business foundations and long-term income potential: Chevron (CVX) and TotalEnergies (TTE). Here's why these two oil stocks are worth considering for your portfolio.



Chevron (CVX): A Conservative Income Play

Chevron is a leading integrated energy company with a strong track record of dividend growth. The company has increased its dividend annually for 37 consecutive years, providing investors with a steady stream of income. With a current dividend yield of 4.1%, Chevron offers an attractive income stream while maintaining a strong balance sheet with a debt-to-equity ratio below 0.2x.

Chevron's integrated business model, which includes upstream, midstream, and downstream operations, provides a buffer against volatile oil prices. The company's low-cost operations, with average oil production costs of around $40 per barrel, enable it to generate cash flow in various market environments. Additionally, Chevron's commitment to returning cash to shareholders through dividends and share repurchases further enhances its appeal as a long-term income investment.

TotalEnergies (TTE): Adapting to the Energy Transition

TotalEnergies is another integrated energy company that offers an attractive dividend yield of 5.6%. While U.S. investors should be aware of French taxes on income, TotalEnergies' commitment to maintaining a stable dividend and its share buyback program make it an enticing option for investors interested in oil stocks.

TotalEnergies is also adapting to the global energy transition by investing in renewable energy, reducing emissions, and expanding into new energy businesses such as hydrogen and electric vehicle charging infrastructure. These strategic initiatives position the company well for a low-carbon future and enhance its long-term prospects as an investment.



Preparing for Volatile Oil Markets

While oil prices can be volatile, investors can prepare for market fluctuations by focusing on the business behind the dividend. Chevron and TotalEnergies' strong balance sheets, integrated business models, and commitment to shareholder returns make them attractive options for long-term income investors.

In conclusion, if you're looking for decades of passive income, consider investing in oil stocks like Chevron and TotalEnergies. These companies offer attractive dividend yields, strong business foundations, and a commitment to long-term income growth. By focusing on the business behind the dividend and preparing for volatile oil markets, investors can build a reliable income stream that can last for years to come.