2 ASX Energy Stocks to Watch as Oil Prices Surge Above US$100

Oil prices have recently stayed around or above US$100 a barrel, largely because the Iran conflict has disrupted oil flows from the Middle East. The conflict has also increased risks around the Strait of Hormuz, forcing producers to rely on more expensive alternative shipping routes.

For ASX energy investors, sustained oil prices around US$100 a barrel could provide another potential tailwind for companies exposed to higher realised oil and energy prices.

Two ASX-listed energy stocks that could benefit further if oil prices remain around US$100 a barrel are Woodside Energy Group Limited (ASX: WDS) and Santos Limited (ASX: STO).

Woodside Energy Group

Woodside Energy Group Limited (ASX: WDS) delivered an impressive H1 FY26 result, with operating revenue increasing 13% year-on-year to US$7.45 billion while underlying NPAT rose 7% to US$1.33 billion.

Free cash flow surged 159% to US$352 million as average realised prices increased 20% to US$74.0 per boe. The higher realised prices more than offset lower production volumes and helped reported NPAT increase 27% to US$1.67 billion.

The result also highlights why a sustained period of higher oil prices could be important for Woodside.

Higher realised prices contributed US$755 million to the change in reported NPAT during H1 FY26. If oil prices remain above US$100 per barrel, higher realised prices could provide another potential tailwind for the company.

Woodside also has a significant pipeline of growth projects.

Scarborough was 98% complete and targeting its first LNG cargo in Q4 2026, while Trion was 64% complete with first oil targeted for 2028. Louisiana LNG was 28% complete with first LNG targeted for 2029.

The company is also expanding its existing portfolio after assuming operatorship of the Gippsland Basin in July 2026. Meanwhile, the planned Chevron asset swap could raise Woodside's participating interest in the North West Shelf from 33.33% to 50%.

Alongside its growth pipeline, Woodside has targeted US$350 million in annual structural cost savings from 2028 and has set a plan to maintain disciplined capital allocation.

The company has a current market capitalisation of almost $60 billion and also offers an annual fully franked dividend yield of 5.18% at the time of writing.

Its H1 FY26 interim dividend rose 8% to 57 US cents per share, representing an 80% payout of underlying NPAT.

Santos

Santos Limited (ASX: STO) also delivered a solid first half of 2026, with production increasing 3% year-on-year to 45.6 million barrels of oil equivalent.

Sales revenue reached US$2.6 billion while free cash flow from operations was US$378 million.

Santos has a current market capitalisation of $27.77 billion and an annual unfranked dividend yield of 3.59% at the time of writing.

However, the company is currently in a transition period.

Underlying profit fell from US$508 million in H1 2025 to US$397 million in H1 2026, while EBITDAX declined from around US$1.76 billion to US$1.56 billion due to commissioning and cargo-timing effects linked to its major growth projects.

The second half is expected to see production rise by around 20% to 30% from the first half as Pikka and Barossa ramp up and Santos moves beyond the peak period of major project spending.

Pikka is the key near-term catalyst for Santos after achieving first oil in May.

Production is targeted to increase from roughly 23,000 barrels per day gross to an approximately 80,000 barrels per day plateau in late Q3 2026.

Barossa is also moving towards steady-state operations, with current production at around 550 million standard cubic feet per day and a target of approximately 600 million standard cubic feet per day by the end of the quarter.

Darwin LNG maintained 100% plant reliability in H1.

Santos also has further growth opportunities beyond these projects.

Papua LNG is targeting a final investment decision in Q4 2026 and could produce up to 6 million tonnes per annum of gross LNG.

The company has US$3.8 billion of liquidity with no debt maturities before September 2027. Santos is also targeting a reduction in net debt of US$2.5 billion by 2030, while structural cost savings are targeted to improve efficiency.

The bottom line

The recent strength in oil prices has put renewed attention on ASX-listed energy companies.

For Woodside, H1 FY26 demonstrated the contribution that higher realised prices can make to earnings, while the company continues to progress its major growth projects.

For Santos, the focus is increasingly on the ramp-up of Pikka and Barossa, alongside its longer-term growth opportunities including Papua LNG.

If oil prices remain around US$100 a barrel, both companies could have additional exposure to higher realised energy prices, while their respective growth projects provide further potential catalysts.