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3 Dividend Stocks to Watch in '25 Despite Energy Market Volatility
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So far in 2025, U.S. energy companies have delivered exceptional outcomes despite the broader market challenges. The energy sector has outperformed the broader market year to date. It has fallen 13.3% compared with the S&P 500's 15.3% decline. This is backed by stable oil and gas prices, strong global demand, and optimism surrounding new LNG infrastructure projects.
The steady performance of oil and gas companies can directly support higher dividend payouts by ensuring consistent cash flow generation, even amid fluctuating commodity prices. Dividend-paying stocks in the same space, such as SLB (SLB - Free Report) , Imperial Oil Limited (IMO - Free Report) and Veren Inc. (VRN - Free Report) , are well-positioned for growth this year.
Market Volatility
The energy sector is currently grappling with significant volatility due to the recent tariff policies enacted by Trump and the subsequent retaliatory measures from other nations. President Trump announced a universal 10% tariff on all imported goods on April 2, 2025. He also announced higher rates for specific countries, including a 125% tariff on China imports. This resulted in instant fluctuations in oil prices, with U.S. benchmark crude dropping to a four-year low of $56.98 per barrel before partially recovering to $60.79 per barrel after a 90-day tariff pause on most countries, excluding China.
The tariffs have disrupted the global supply chains, increased production costs for energy infrastructure and created uncertainty for investors. Retaliatory tariffs from countries like China and the European Union have strained international trade relationships, leading to price fluctuations in commodities, such as oil and natural gas.
Looking ahead, oil prices are likely to remain sensitive to further developments in the U.S. trade policies, with sustained recovery hinging on potential tariff relief for China and clearer signs of global economic stabilization.
Dividend Stocks Come to the Rescue
The drastic fluctuation of oil prices may discourage investors from allocating funds to energy companies. Despite this volatility constraint, investors may consider dividend-paying companies belonging to the industry. This is because, generally, companies with a stable dividend-paying history are less volatile than stocks with no dividend history. It is expected that companies that have been rewarding stockholders with dividends will try their best to continue paying at the same pace or higher next year, making the stocks attractive and less volatile to the vagaries of the market.
Here are a few dividend stocks that could offer substantial returns through regular payouts.
We have employed our Stock Screener to zero in on three such stocks. With a dividend yield of more than 2%, all these companies have raised dividends over the past five years. Moreover, with a payout ratio of less than 60%, the companies ensure sustainability with enough scope for dividend increases.
Dividend Stocks to Watch
SLB: SLB is a leading oilfield service company providing services to oil and gas explorers, and producers globally. In January 2025, SLB’s board of directors approved a 3.6% increase to its quarterly dividend to 28.5 cents per share from 27.5 cents, beginning with the dividend payable in April 2025. SLB expects to return at least $4 billion to shareholders in 2025 through dividends and share repurchases, up from $3.3 billion in 2024.
The Zacks Rank #3 (Hold) company has demonstrated a clear and consistent upward trajectory in its dividend payments. SLB has maintained a steady commitment to returning capital to shareholders through dividends, with regular increases over the past two years. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Imperial Oil: IMO operates as an integrated energy company that explores, produces and sells crude oil and natural gas, along with refining petroleum products and manufacturing petrochemicals, across Canada. The company currently has a Zacks Rank #3.
Imperial Oil has an impressive dividend history, increasing payouts consistently for three decades, with a clear acceleration in growth. Since 2020, the company has increased its quarterly dividend per share by more than 225%, showcasing a firm commitment to enhancing shareholder value over the medium term.
The company declared a new dividend of 72 cents per share in early 2025, payable April 1, 2025. This 20% increase marks the largest nominal dividend growth in the company's history, underlining its confidence in the business's ongoing performance and cash flow generation capacity.
Veren: VRN is engaged in the acquisition, development, and production of petroleum and natural gas properties, with a focus on assets in the Alberta Montney and Kaybob Duvernay regions. The company currently has a Zacks Rank #2 (Buy).
Veren has demonstrated a consistent commitment to increasing shareholder returns through its dividend policy over the past three years. In 2024, the company declared total dividends of $284.6 million, up from $211.9 million in 2023 and $200.6 million (36 cents per share) in 2022.
As of 2025, Veren’s base dividend stands at 11.5 cents per share every quarter, reflecting management's focus on sustaining dividends even at lower commodity prices. In alignment with its return of capital framework, Veren targets to return 60% of its annual excess cash flow to shareholders, combining base dividends and share repurchases. This policy is designed to balance capital returns with financial flexibility, supporting sustainable dividend growth while reinforcing the company's commitment to delivering value to shareholders over the long term.
Image: Bigstock
3 Dividend Stocks to Watch in '25 Despite Energy Market Volatility
So far in 2025, U.S. energy companies have delivered exceptional outcomes despite the broader market challenges. The energy sector has outperformed the broader market year to date. It has fallen 13.3% compared with the S&P 500's 15.3% decline. This is backed by stable oil and gas prices, strong global demand, and optimism surrounding new LNG infrastructure projects.
The steady performance of oil and gas companies can directly support higher dividend payouts by ensuring consistent cash flow generation, even amid fluctuating commodity prices. Dividend-paying stocks in the same space, such as SLB (SLB - Free Report) , Imperial Oil Limited (IMO - Free Report) and Veren Inc. (VRN - Free Report) , are well-positioned for growth this year.
Market Volatility
The energy sector is currently grappling with significant volatility due to the recent tariff policies enacted by Trump and the subsequent retaliatory measures from other nations. President Trump announced a universal 10% tariff on all imported goods on April 2, 2025. He also announced higher rates for specific countries, including a 125% tariff on China imports. This resulted in instant fluctuations in oil prices, with U.S. benchmark crude dropping to a four-year low of $56.98 per barrel before partially recovering to $60.79 per barrel after a 90-day tariff pause on most countries, excluding China.
The tariffs have disrupted the global supply chains, increased production costs for energy infrastructure and created uncertainty for investors. Retaliatory tariffs from countries like China and the European Union have strained international trade relationships, leading to price fluctuations in commodities, such as oil and natural gas.
Looking ahead, oil prices are likely to remain sensitive to further developments in the U.S. trade policies, with sustained recovery hinging on potential tariff relief for China and clearer signs of global economic stabilization.
Dividend Stocks Come to the Rescue
The drastic fluctuation of oil prices may discourage investors from allocating funds to energy companies. Despite this volatility constraint, investors may consider dividend-paying companies belonging to the industry. This is because, generally, companies with a stable dividend-paying history are less volatile than stocks with no dividend history. It is expected that companies that have been rewarding stockholders with dividends will try their best to continue paying at the same pace or higher next year, making the stocks attractive and less volatile to the vagaries of the market.
Here are a few dividend stocks that could offer substantial returns through regular payouts.
We have employed our Stock Screener to zero in on three such stocks. With a dividend yield of more than 2%, all these companies have raised dividends over the past five years. Moreover, with a payout ratio of less than 60%, the companies ensure sustainability with enough scope for dividend increases.
Dividend Stocks to Watch
SLB: SLB is a leading oilfield service company providing services to oil and gas explorers, and producers globally. In January 2025, SLB’s board of directors approved a 3.6% increase to its quarterly dividend to 28.5 cents per share from 27.5 cents, beginning with the dividend payable in April 2025. SLB expects to return at least $4 billion to shareholders in 2025 through dividends and share repurchases, up from $3.3 billion in 2024.
The Zacks Rank #3 (Hold) company has demonstrated a clear and consistent upward trajectory in its dividend payments. SLB has maintained a steady commitment to returning capital to shareholders through dividends, with regular increases over the past two years. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
(Check SLB’s dividend history here).
Schlumberger Limited Dividend Yield (TTM)
Schlumberger Limited dividend-yield-ttm | Schlumberger Limited Quote
Imperial Oil: IMO operates as an integrated energy company that explores, produces and sells crude oil and natural gas, along with refining petroleum products and manufacturing petrochemicals, across Canada. The company currently has a Zacks Rank #3.
Imperial Oil has an impressive dividend history, increasing payouts consistently for three decades, with a clear acceleration in growth. Since 2020, the company has increased its quarterly dividend per share by more than 225%, showcasing a firm commitment to enhancing shareholder value over the medium term.
The company declared a new dividend of 72 cents per share in early 2025, payable April 1, 2025. This 20% increase marks the largest nominal dividend growth in the company's history, underlining its confidence in the business's ongoing performance and cash flow generation capacity.
(Check Imperial Oil’s dividend history here).
Imperial Oil Limited Dividend Yield (TTM)
Imperial Oil Limited dividend-yield-ttm | Imperial Oil Limited Quote
Veren: VRN is engaged in the acquisition, development, and production of petroleum and natural gas properties, with a focus on assets in the Alberta Montney and Kaybob Duvernay regions. The company currently has a Zacks Rank #2 (Buy).
Veren has demonstrated a consistent commitment to increasing shareholder returns through its dividend policy over the past three years. In 2024, the company declared total dividends of $284.6 million, up from $211.9 million in 2023 and $200.6 million (36 cents per share) in 2022.
As of 2025, Veren’s base dividend stands at 11.5 cents per share every quarter, reflecting management's focus on sustaining dividends even at lower commodity prices. In alignment with its return of capital framework, Veren targets to return 60% of its annual excess cash flow to shareholders, combining base dividends and share repurchases. This policy is designed to balance capital returns with financial flexibility, supporting sustainable dividend growth while reinforcing the company's commitment to delivering value to shareholders over the long term.
(Check Veren’s dividend history here).
Veren Inc. Dividend Yield (TTM)
Veren Inc. dividend-yield-ttm | Veren Inc. Quote