US President Donald Trump was explicit about where he sees the opportunity, saying: “We’re going to have our very large United States oil companies, the biggest anywhere in the world, go in, spend billions of dollars, fix the badly broken infrastructure … and start making money for the country.”

Of course, that points squarely towards US oil companies rather than European majors.

Political risk, sanctions history and the heavy-crude nature of Venezuela’s reserves have long deterred overseas investment. But with a potential reset under US influence, the balance could be shifting.

Exposure to Venezuela

Energy analysts are already outlining who stands to benefit most.

Francisco Monaldi, director of the Latin America Energy Program at Rice University’s Baker Institute, believes Chevron is immediately well positioned due to its long-standing presence in the country.

It’s the only company with a current presence in Venezuela and it’s been operating there for over 100 years. It currently exports around 150,000 bpd to the US.

However, Monaldi also notes that other US oil majors will tread carefully at first, watching political stability and the contractual framework before committing serious capital.

One company that stands out is ConocoPhillips (NYSE:COP). Conoco is owed more than $11bn following past expropriations plus interest. This is money it is unlikely to recover without re-entering Venezuela.

Exxon could also return, though it is owed less. BP and Norway’s Equinor (then Statoil) were among other Western companies operating in Venezuela.

Chevron, Conoco and Exxon are all comfortable operating in heavy oil, which remains strategically important for US refining.

European firms, by contrast, may be more hesitant, especially given their stronger focus on decarbonisation. They also may not be offered a seat at the table.

Chevron’s chief executive, Mike Wirth, has already confirmed discussions with both the Biden and Trump administrations, underlining the importance of maintaining an American presence in Venezuela.

Any meaningful production increase would also require oilfield service groups such as SLB, Baker Hughes and Halliburton.

One to watch

For investors, ConocoPhillips has potential to be the most materially impacted. This is purely assumptive, but given the size of the money owed to business by the Venezuelan state.

The stock trades with a price-to-earnings multiple of 14.8 times, representing a modest 8% premium to the energy sector average.

However, the broad trend across all the valuation metrics is it’s cheaper than giants Chevron and Exxon, but more expensive than European peers.

It also stands out for its best-in-class margins. This tells us it’s more efficient than its peers at turning revenue into earnings. A dividend yield of around 3.3% adds income appeal.

That said, Trump’s comments also imply sizeable upfront investment, which could weigh on near-term earnings. It may be years before there is any meaningful contribution to earnings. Political instability remains a risk too.

Still, if Venezuela genuinely reopens to US oil, ConocoPhillips could be one of the most interesting names to watch. It could be worth considering as an investment, but the stock may move significantly in the pre-market on Monday.

The post ‘US is running Venezuela’: what does this mean for oil stocks? appeared first on The Motley Fool UK.

Source: JP Morgan Q4 Guide to the Markets

I don’t have any argument with the data and I’m half expecting a difficult year for the stock market in 2026. So why do I think investors should keep investing?

Cost averaging

A lot of investors follow a strategy known as cost averaging. This involves buying shares with a fixed amount on a regular basis, regardless of what’s going on with prices. 

One of the best things with this approach is it removes any concerns about valuations. It doesn’t matter whether stocks are cheap or expensive, you just buy regularly and consistently. 

It works as long as share prices go up over time. Investors end up with a cost basis in line with the historical average and they make money as long as stocks eventually go higher.

For anyone using this method, high share prices are no reason to stop buying. The plan is valuation-agnostic, so investors shouldn’t see this as important.

Value investing

Some investors, however, have strategies that do focus on valuations. And for anyone taking this type of approach, high price-to-earnings (P/E) ratios are something to pay attention to.

I’m in this position – I’m very uneasy at the idea of buying stocks at prices that I think are too high. But the solution for investors like me is straightforward – just don’t buy the S&P 500. 

There are literally hundreds of individual stocks to consider at the moment. And the fact the US index as a whole is historically expensive doesn’t mean all of its constituents are. 

In fact, the S&P 500 has become extremely concentrated around a few artificial intelligence (AI) names. But beyond these, there are a number of stocks that don’t look expensive at all. 

Energy

One of the worst-performing sectors from the S&P 500 has been energy. But I think investors interested in valuations might look at the likes of ConocoPhillips (NYSE:COP) as a result.

Falling oil prices have been – and remain – a potential risk. But I think the company is in a strong position to withstand a downturn in commodity prices. 

The firm’s assets typically have production costs between $30 and $35 a barrel. Its balance sheet is also strong, which should help with its resilience. And then there’s the dividend. 

Despite falling prices, ConocoPhillips has returned almost $7bn to investors since the start of 2025. At its current market value, that’s a 6.5% return so far this year with more to come in Q4.

Opportunities

In general, high valuations aren’t a reason to stop buying stocks. For anyone looking to cost average, this is part of the plan and I think there are also opportunities for value investors.

It’s surprising to me that the US energy sector has struggled when one of the main challenges to AI growth in 2026 is how to power data centres. But I see attractive valuations there.

ConocoPhillips is one name that I think investors could consider. But for my own portfolio, there’s a slightly riskier oil stock outside the S&P 500 that I like even more at today’s prices.

The post Why high valuations aren’t a reason for investors to stop buying stocks appeared first on The Motley Fool UK.

Since the start of the year, the FTSE 100 is up 6% while the S&P 500 is roughly where it was at the start of January. So does that mean it’s time for investors to look at buying US shares?

The S&P 500 doesn’t look cheap

The MSCI US Index has underperformed the MSCI World Index since the start of the year. But the S&P 500 as a whole posted earnings growth of around 18% in the fourth quarter of 2024.

That’s very impressive and higher earnings do make valuations more attractive. However, in the grand scheme of things, the difference is fairly marginal. 

Source: Longtermtrends

The current price-to-earnings (P/E) ratio of the S&P 500 is towards the higher end of where it has been over the last 10 years. And history tells us that returns from these levels are typically underwhelming.

Of course, the future doesn’t always resemble the past. But I think there are opportunities in individual stocks that look much more attractive.

Not all stocks are same

The S&P 500 is in positive territory since the start of the year, but not every stock has performed the same. So far, one of the worst-performing sectors in 2025 has been energy.

Overall, energy shares are down around 3.5% and some individual stocks have fared much worse. But this is the kind of shift that I think can generate opportunities for investors.

A sector falling out of favour with the stock market can give investors a chance to buy the best shares at unusually good prices. Right now, I think ConocoPhillips (NYSE:COP) might be a good example.

The stock is down almost 14% since the start of the year, but the company’s long-term advantages remain intact. And it has ambitious plans for shareholder returns.

A potential energy opportunity

In 2024, ConocoPhillips generated just over $8.25bn in free cash and it has ambitious plans to grow this by $6bn between now and 2029. If it can do this, the current share price looks very cheap.

The firm’s stated target involves the company generating almost 15% of its current market value in free cash each year from 2029. But a lot depends on what happens to oil prices in the next few years.

This is the biggest risk with ConocoPhillips shares. Its future ambitions are based on an average oil price of $70 per barrel and it’s worth noting the price of WTI crude is currently 10% below this. 

Investors therefore shouldn’t count their chickens prematurely. But with a significant amount of untapped inventory available at less than $40 per barrel, there could still be good returns on the way.

Greedy when others are fearful

US stocks as a whole don’t look like an obvious buying opportunity to me at the moment. But it’s a different story with the out-of-fashion energy sector and ConocoPhillips is a good example.

The firm is currently set to return almost 100% of its market value to shareholders over the next 10 years. And with ambitious growth plans ahead, I think it’s worth considering at today’s prices.

The post As the S&P 500 falters, is it time to buy US shares? appeared first on The Motley Fool UK.