3 Energy Stocks Raising Dividends as the Sector Surges

Energy is the best-performing sector in 2026, and it's not even close. The S&P 500 energy sector has delivered a total return of more than 40% in 2026. Meanwhile, the next best-performing sector, technology, has a return below 30%. Large increases in energy commodity prices have been a boon to the sector, with West Texas Intermediate oil futures up more than 40% in 2026.

While energy’s price performance may not always be this strong, many names in this sector provide solid dividend returns, making them appealing to investors.

The energy sector has also recently seen a wave of dividend increases, ranging from names among the biggest leaders in refining to those in lesser-known market niches.

Three names boosting their payouts all provide meaningful yields, solid dividend sustainability, and strong growth in 2026.

BP Boasts Over 4% Yield as Profits Rise 78%

First up is one of the world’s most well-known names in the energy sector, BP (NYSE: BP). With a market capitalization of around $110 billion, BP is one of the 15 most valuable firms in the worldwide oil, gas, and consumable fuels industry. The stock has performed well in 2026, generating a return near 30%. Soaring oil prices have helped the company’s profits balloon.

‘Underlying profit’ is the key performance metric BP references, which adjusts for fluctuations in the value of oil inventories. The figure rose strongly by 78% year-over-year (YOY) in Q2. This came even as refining throughput was down 4% versus Q1 due to planned facility maintenance.

BP also announced a 4% increase to its quarterly dividend. While this boost is moderate, it adds to BP’s already very strong dividend yield, which sits near 4.6% on a forward basis. This figure significantly exceeds the dividend yields of several U.S. oil giants, such as Chevron (NYSE: CVX), with its approximately 3.5% yield.

At first glance, BP’s dividend sustainability looks questionable, with its payout ratio near 100%. However, based on cash flow, which is often better for measuring the dividend sustainability of capital-intensive firms, BP’s payout ratio is just 21%, indicating that BP’s dividend is well supported.

Excelerate Energy Ups Dividend 12.5% as Shares Take Off

Excelerate Energy (NYSE: EE) is a significant player in the liquefied natural gas (LNG) industry and has a market capitalization of over $4 billion. The company’s floating regasification units (FSRUs) convert LNG to natural gas, which then flows through pipeline infrastructure. Much of its demand comes from island nations that lack direct access to natural gas for purposes like heating. The stock has also put up strong returns in 2026 of almost 40%.

Notably, the firm posted solid adjusted EBITDA growth of 12% YOY last quarter. The company raised its full-year adjusted EBITDA guidance to $490 million to $515 million, citing a strong first half. Excelerate also continues to add more capacity to serve demand, targeting the commercial deployment of its recently purchased Methane Patricia Camila unit in early 2028.

Excelerate announced a hefty 12.5% dividend increase during its latest earnings report, moving its payout to 9 cents per quarter. Although not large, Excelerate’s forward dividend yield of near 1% is meaningful, providing a moderate income return. Meanwhile, Excelerate already has a very strong payout ratio near 22%, and analysts expect the figure to improve to 16% based on next year’s earnings estimates.

Top Berkshire Position Occidental Petroleum Issues Sizable Dividend Boost

Occidental Petroleum (NYSE: OXY) is not necessarily a household energy name, but Berkshire Hathaway (NYSE: BRK.B) knows this firm very well. Berkshire invested $7.7 billion in OXY in Q1 2022, and it continues to be one of the firm’s largest holdings, even after Warren Buffett’s retirement. At around $12.9 billion, OXY accounted for 4.3% of Berkshire’s portfolio as of the end of Q2. In his retirement, Buffett is likely smiling at OXY’s 2026 performance, with shares delivering a total return of more than 40%.

Occidental put up robust financial performance in Q2, generating around $3 billion in free cash flow. This was the firm’s highest free cash flow post since late 2022. It also raised its full-year production guidance and lowered its principal debt by $1.5 billion versus Q1 to its lowest level since Q2 2019.

Occidental is adding juice to its dividend, increasing its quarterly payout by about 8%. The stock’s forward yield now sits at 1.8%, providing a solid stream of dividend income. Additionally, Occidental is in a strong position when it comes to dividend sustainability. Its payout ratio is only around 16%, while its cash flow-based payout ratio is near 10%.

Occidental Watch Items: Capital Spending Decreases Post-2027, Berkshire Position

Looking ahead, it will be important to see if Occidental can achieve its $4 billion sustainable cash flow improvement target by 2030. It expects to drive this through lower costs and lower capital spending, making downward moves in these figures important to watch after 2027. The company expects capital spending of $5.5 billion to $5.9 billion in 2026 and $5.9 billion in 2027.

Additionally, changes in Berkshire’s Occidental holding will be notable. Since Q1 2025, Berkshire has consistently held around 265 million OXY shares. Changes in this figure could indicate whether Berkshire’s conviction in this name is strengthening or deteriorating.

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