Goldman Sachs expects peak oil demand to be another decade away. Diamondback Energy's strategic growth in the Permian Basin positions it as a top producer with significant growth opportunities. FANG's efficient operations, cost-saving measures, and attractive cash return strategy make it a compelling investment in the current oil price environment.

At this writing, current inflation rate is 3% over the past 12 months. That's the reading as of the end of June.

A relatively high price of oil is helping exploration and production companies generate plenty of cash. Many oil companies, Diamondback Energy included, have taken advantage of attractive valuations to buy assets.

While the ideological machinery is seemingly focused on zero emissions, don't be mistaken: the world is consuming energy-related resources at a blistering pace. This situation will likely only be exacerbated with global population growth combined with advanced technologies like artificial intelligence.

Everyone's definition of cash-cow stocks is different. I consider cash-cow stocks to be companies whose free cash flow (FCF) is considerably higher than the capital expenditures required to keep the business running efficiently.

Diamondback (FANG) has an impressive earnings surprise history and currently possesses the right combination of the two key ingredients for a likely beat in its next quarterly report.

The S&P 500 is booming. The popular benchmark index is up 16% this year and is 44% higher since the start of 2023.

The energy sector underperformed the S&P500 in Q2 2024, continuing a trend that started earlier, and this is likely to continue heading into H2 2024. There are a number of factors that seem to be weighing on the energy sector, although some stocks are affected more than others. Crude oil is hemmed in between two opposing forces, which are both trying to impose their influence on prices.

Diamondback Energy (FANG) concluded the recent trading session at $200.19, signifying a +0.5% move from its prior day's close.

Over the past five days, the S&P 500 index dipped by 0.17%. The technology sector, represented by the SPDR Select Sector Fund – Technology XLK, declined by 2.23%.

I'm going to let you in on a little secret (which isn't that much of a secret): the world runs on oil. Thanks to the energy density of hydrocarbons, global societies will probably run on oil for as long as we all shall live.

Improving Permian production amid healthy oil prices raises the incentive to keep an eye on companies like ExxonMobil (XOM), Chevron (CVX) and Diamondback Energy (FANG).