The Saudi Oil Workaround Just Broke. Here Are 5 Stocks to Watch

By AltIndex Research · 12 min read · September 14, 6:13 am

The Strait of Hormuz was already a problem for global oil markets. Now one of Saudi Arabia's most important ways around it is offline. A drone attack has shut the kingdom's East-West pipeline, threatening as much as 4% of global oil supply if flows cannot resume within days. For investors, the immediate trade is higher oil. The more interesting question is which energy companies were already strengthening before the latest supply shock.

Saudi Arabia has been using its East-West pipeline to move roughly 4 million barrels of crude per day across the country to the Red Sea port of Yanbu, bypassing the disrupted Strait of Hormuz. Following a drone attack, that route is now shut. Estimates for repairs range from several days to as long as five or six weeks, while inventories at Yanbu are reportedly sufficient to maintain exports for only another five to seven days.

The impact is beginning to move beyond oil futures. Asian refiners are preparing for delays and tighter supplies of sour crude, with buyers potentially having to compete for replacement barrels from Iraq, the UAE and other producers. Brent crude moved above $108 per barrel on Monday.

The development also changes an investment thesis we highlighted earlier this summer. In July, we looked at six stocks positioned for a blocked Strait of Hormuz. Our argument was that the opportunity had moved beyond simply betting on higher oil. Constrained Gulf exports increased the value of pipelines, alternative production, LNG infrastructure and tankers capable of moving energy around the disruption.

Now the workaround itself has been hit.

We screened 15 energy companies and looked at six months of AltIndex data, including AI Scores, hiring, LinkedIn headcount, employee business outlook, web traffic and analyst sentiment. Five stocks stand out.

AltIndex data through September 2026. Six-month price changes are approximate. AI Scores are designed for a six-to-nine-month horizon.

Marathon Petroleum: The Strongest Overall Setup

Marathon Petroleum has the strongest AI Score in our screen at 81, up from 55 six months ago. Employee confidence has also improved, with positive employee business outlook increasing from 79% in March to 84% in September.

Estimated web traffic provides another positive signal. Monthly traffic increased from roughly 61,000 visits in March to more than 87,000 in July, an increase of about 43%.

Those signals are being backed by unusually strong financial results. Marathon reported second-quarter net income of $5.1 billion, compared with $1.2 billion a year earlier. Adjusted EBITDA increased from $3.3 billion to $8.5 billion, while Refining & Marketing adjusted EBITDA jumped to $6.7 billion from $1.9 billion. The company returned another $2.8 billion of capital to shareholders during the quarter.

Refining margins were already doing much of the work. Marathon's Refining & Marketing margin reached $36.33 per barrel during the quarter, more than double the $17.58 reported a year earlier.

The important distinction is that Marathon does not need the Saudi pipeline to remain offline for its investment thesis to work. But a prolonged disruption could further tighten global crude and refined-product markets at a time when the company's refining operations are already performing exceptionally well.

Energy Transfer: The Infrastructure Play

The Saudi pipeline attack is ultimately a reminder that moving energy can become almost as important as producing it.

That makes Energy Transfer particularly interesting. Its AI Score has climbed from 52 to 73 over the past six months. Estimated LinkedIn headcount increased from 7,374 employees in March to 7,757 in September, growth of roughly 5%, while employee business outlook improved from 81% to 83%.

Estimated web traffic has also increased sharply, from roughly 151,000 visits in March to more than 230,000 in August, an increase of about 53%.

The financial numbers point in the same direction. Energy Transfer reported second-quarter adjusted EBITDA of $5.07 billion, up 31% year over year, while distributable cash flow increased 32% to $2.59 billion. Management raised its full-year adjusted EBITDA guidance to between $18.8 billion and $19.1 billion.

Energy Transfer is not a direct substitute for Saudi Arabia's East-West pipeline. The broader investment case is that repeated disruptions to global energy transportation increase the strategic value of large, difficult-to-replicate North American pipeline and export networks.

Occidental Petroleum: Hiring Accelerated Before the Latest Oil Shock

Occidental Petroleum gives investors the most direct exposure in this group to sustained higher crude prices, but our data show something was changing at the company before the latest Saudi attack.

Tracked LinkedIn job postings stood at fewer than 30 in mid-March. Hiring then accelerated through the spring and summer, reaching more than 100 openings on several days in August. The latest reading is 74. Occidental's positive employee business outlook also improved from 76% to 80%, while its AI Score increased from 55 to 73.

The trend is more useful than the latest reading alone. Average tracked openings climbed from roughly 35 in March to 89 in August. Hiring has cooled slightly in September, but it remains more than twice the March average.

Unlike Marathon and Phillips 66, the stock has not already experienced an enormous repricing. OXY is up only around 7% over our six-month dataset.

The company's latest financial results were strong as well. Occidental generated $5.1 billion of operating cash flow from continuing operations during the second quarter and $3 billion of free cash flow before working capital. Production of 1.433 million barrels of oil equivalent per day exceeded the high end of guidance, while the company reduced principal debt by another $1.9 billion to $11.8 billion.

There is an important counter-signal. Only 29% of analysts currently rate OXY a buy. That disagreement between improving operating and alternative-data signals and relatively cautious Wall Street sentiment makes Occidental one of the more interesting stocks to monitor if oil remains above $100.

Kinder Morgan: The Data and the Stock Are Moving in Opposite Directions

Kinder Morgan is the contrarian stock in this screen.

Its shares have fallen roughly 6% over the past six months. Underneath that decline, several of the indicators we track have moved in the opposite direction.

LinkedIn job postings increased from 249 in mid-March to 368 in the latest reading. Estimated LinkedIn headcount increased from 9,072 to 9,406, while estimated monthly web traffic almost doubled from about 69,000 visits in March to more than 131,000 in August. Kinder Morgan's AI Score has meanwhile risen from 40 to 62.

The divergence becomes clearer when the daily noise is removed. KMI averaged about $32.85 in March while we tracked an average of 246 open positions. In September the average share price is about $31.50, while tracked openings have climbed to roughly 354.

The company's fundamentals provide some support for that divergence. Kinder Morgan reported record second-quarter adjusted EBITDA of $2.2 billion, up 12% year over year, while adjusted EPS increased 32%. Management now expects 2026 adjusted EBITDA to finish more than 5% above its original budget.

Its expansion pipeline is also substantial. Kinder Morgan ended the quarter with a $9.6 billion project backlog, with natural-gas projects accounting for roughly 92%.

For us, KMI is therefore less about predicting an immediate oil-price spike and more about the gap between the stock and the company's underlying activity. If hiring continues to expand while earnings outperform expectations, that gap becomes increasingly difficult to ignore.

Phillips 66: Strong Signals, But Much More Is Priced In

Phillips 66 has many of the same characteristics as Marathon, but there is one major difference: investors have already noticed.

PSX shares have gained roughly 52% over the past six months.

The alternative data remain encouraging. Its AI Score has increased from 46 to 63. Tracked job postings increased from 52 to 72, while estimated LinkedIn headcount grew from 13,139 to 13,536. Employee business outlook has also edged higher from 53% to 55%.

Estimated web traffic increased from roughly 137,000 monthly visits in March to more than 252,000 in July.

The operating results explain why investors have been willing to reprice the stock. Phillips 66 earned $3.8 billion in the second quarter, achieved 96% refining utilization and reported record NGL fractionation and LPG export volumes. It also reduced total debt by $6.6 billion.

PSX therefore still belongs on the watchlist, particularly if disruption creates another period of unusually strong refining economics. But compared with Occidental or Kinder Morgan, considerably more optimism appears to be reflected in the share price already.

Not Every Oil Stock Looks Equally Attractive

The point of looking beyond oil prices is that the screen does not simply tell us to buy every energy company.

Valero Energy, for example, has gained roughly 71% over the six-month period, but its AI Score has fallen from 65 to 55 and employee business outlook has declined from 88% to 78%.

Exxon Mobil's workforce and hiring indicators are stronger, but its latest AI Score sits at only 52. Chevron has also expanded its estimated LinkedIn headcount while tracked job openings have moved lower.

There are interesting signals outside our five selections too. Texas Pacific Land's estimated LinkedIn workforce has expanded substantially even as its shares have fallen, while TORM, one of the tanker stocks highlighted in our July Hormuz article, is up roughly 48% over the past six months and now carries an AI Score of 68.

Those stocks remain worth watching. But the clearest combination of financial performance, exposure to the changing energy market and strengthening alternative data currently sits with the five names above.

What Happens Next?

The most important variable is not today's oil price. It is how long Saudi Arabia's East-West pipeline remains offline.

Saudi Arabia reportedly has enough crude stored at Yanbu to maintain exports for roughly another five to seven days. If pipeline flows resume quickly, some of the current geopolitical premium could disappear. If repairs stretch into weeks, however, the market could lose access to as much as 4 million barrels per day from a route specifically designed to bypass the problems in the Strait of Hormuz.

There is already evidence that refiners are preparing for that possibility. Asian buyers are reporting expected loading delays and tighter sour-crude availability, potentially increasing competition for barrels from Iraq and the UAE.

There is also a broader risk to the bullish energy trade. Oil above $100 can eventually destroy demand. It raises transportation and manufacturing costs, squeezes consumers and can keep inflation elevated enough to force central banks to maintain tighter monetary policy. A prolonged shock could therefore be good for some energy companies while becoming increasingly bad for the economy around them.

The Bottom Line

When we looked at the Strait of Hormuz in July, our argument was that investors should look beyond the crude price itself. If oil cannot move through its normal routes, the value shifts toward alternative production, pipelines, LNG infrastructure and shipping.

The Saudi pipeline attack pushes that thesis one step further. The route designed to bypass the world's most important oil chokepoint is now itself offline.

Among the 15 energy stocks we screened, Marathon Petroleum currently has the strongest overall setup, with an AI Score of 81 alongside improving employee confidence and exceptionally strong refining results. Energy Transfer offers the infrastructure angle, while Occidental stands out because hiring was accelerating well before the latest oil shock.

But Kinder Morgan may be the most interesting stock to watch. Its shares have moved lower even as hiring, LinkedIn headcount, web traffic, earnings and its AI Score have strengthened. That does not guarantee the stock will catch up, but it is precisely the kind of divergence alternative data can help investors identify before it becomes obvious in the price.

The next few days matter. If Saudi Arabia restores meaningful pipeline flows, the supply shock could ease quickly. If Yanbu inventories begin running down while the pipeline remains impaired, the pressure on global oil markets could become considerably more serious.