10 Best ASX Energy Stocks to Watch in 2025

Australia's energy sector is a significant player in the global energy market, particularly in the fossil fuel and renewable energy sectors. In recent years, Australia's energy sector has been undergoing structural change as the global transition to clean energy accelerates.

This transition is also being fuelled by policy adjustments by the Australian government, such as support for the new energy sector. In addition, the performance of ASX energy stocks is closely linked to the global economic environment, commodity prices and domestic and international policy changes, which together shape the market performance and investment outlook for ASX energy stocks.

This article will explore the impact of changes in the global energy market on ASX energy stocks, highlight the ten best ASX energy stocks, and explain how to invest in energy stocks in Australia.

What are ASX energy stocks?

ASX energy stocks encompass a diverse range of companies that are pivotal to the global economy by generating and distributing energy resources essential for powering various devices and operations. These ASX e nergycompanies are engaged in the exploration, production, and sale of oil, gas, electricity, and renewable energy projects. They play a crucial role in finding and producing oil and gas for electricity generation and fuel manufacturing, which are also used as raw materials in the production of numerous goods.

Additionally, they are responsible for generating and distributing electricity and natural gas to consumers, both retail and business, and contribute to the generation of renewable energy by manufacturing components for renewable energy production or operating renewable energy facilities themselves. As climate change becomes an increasingly pressing concern, the energy sector is evolving, with a growing focus on renewable energy sources.

How have energy stocks performed after Trump's second term?

Following the election of Donald Trump, the performance of energy stocks has shown a divergence :

1. Rise in fossil fuel stocks: Trump's victory triggered market optimism about fossil fuel investments. Energy stocks, particularly those related to oil and gas production, performed strongly. For example, the Energy Select Sector SPDR Fund (XLE) rose nearly 4% in the day following Trump's victory. The market reacted positively to Trump's promise to ease restrictions on the oil and gas industry, which could increase the U.S. oil production.

2. Fall in renewable energy stocks: In contrast, stocks of renewable energy companies faced a fall. US solar giant First Solar saw its shares fall by more than 10 per cent the day after Trump's victory. This reflects market expectations that Trump may reduce support for renewable energy.

3. Policy expectations: Trump had emphasised in his speech plans to increase US oil and gas production, both of which are currently at record levels. The market expects that US fossil fuel production could increase further if the Trump administration withdraws again from the Paris Climate Agreement and regulations are further relaxed.

4. Implications for renewable energy policy: Despite the fact that Trump may challenge climate initiatives and relax fossil fuel regulation, he has reintroduced tax credits for solar and wind projects, as well as electric vehicles, in his previous term. According to the U.S. Energy Information Administration, U.S. Wind power generation grew by 45 per cent between 2016 and 2020, Trump's first term, while solar power generation more than doubled.

Energy stocks responded positively to fossil fuels and negatively to renewables after Trump's election, reflecting market anticipation of his policies. Trump administratation could reshape energy policy to prioritise fossil fuels, but state and private investment in renewable energy is expected to continue, highlighting the complex interplay between environmental goals and economic interests.

Why invest in ASX energy stocks?

An investor's exposure to Australian energy stocks offers the following benefits:

1. Growing global energy demand: Asx energy stocks allow investors to benefit from the growth in global energy demand, particularly in the transition to cleaner energy sources. As global demand for renewable energy rises, Australian energy companies have the opportunity to expand their market share, providing investors with growth potential.

2. Income potential: Australian energy companies, particularly those involved in utilities, typically have a history of paying dividends to shareholders. This provides an attractive investment option for investors seeking a steady stream of income, particularly in a low interest rate environment.

3. Capital appreciation potential: Depending on market conditions, share price movements and company performance, Australian energy stocks have the potential to experience capital appreciation. As technological advances and market expansion occur in the energy sector, investors are likely to benefit from rising share prices.

4. Diversified portfolio: Investing in Australian energy stocks can add diversification to a portfolio as they may not be fully correlated with the performance of other asset classes. This diversification can help investors spread risk and improve the overall stability of their portfolio.

5. Market access: The Australian Stock Exchange (ASX) provides a relatively easy-to-access market where investors can buy and sell energy stocks relatively easily and with relatively low transaction costs. This makes Australian energy stocks an approachable investment option for investors of all sizes.

10 best ASX energy stocks to watch

The following energy stocks are ranked by market capitalisation on the Australian Securities Exchange(ASX)：

Woodside Energy

Woodside Energy Group is engaged in the exploration, appraisal, development, production, and marketing of oil and gas. The company's production includes natural gas, natural gas liquids, condensate and oil, Woodside Energy Group has operations in the Asia Pacific region, Africa, the Americas, and Europe, and holds stakes in a number of significant Liquid Natural Gas(LNG) projects and oil and gas fields.

Santos Ltd

Santos Ltd explores, develops, produces, transports and markets hydrocarbons in Australia and the Asia Pacific region. As one of Australia's largest suppliers of natural gas, Santos Ltd owns liquefied natural gas (LNG), pipeline gas and petroleum assets, and its operations extend into the waters of Western Australia and the Northern Territory. The company is also engaged in the development of carbon capture and storage technologies and the production of natural gas, LPG, ethane, methane, coal bed methane, LNG, shale gas, condensate, and petroleum.

Yancoal Australia

Yancoal Australia Ltd owns or operates a number of producing coal mines primarily in the states of New South Wales, Queensland and Western Australia. Yancoal Australia's operations encompass the full spectrum of coal mining, from exploration and development through to the production and sale of coal, which is predominantly coal, including both power and metallurgical coal.

Ampol

Ampol Ltd has been one of Australia's main suppliers of transportation energy for more than 100 years.With operations across the entire energy value chain, including fuels, amenities and energy, Ampol is committed to playing a role in the energy transition and shaping the future of fuels, amenities and energy in the region.

Nexgen Energy

Nexgen Energy Ltd. is principally engaged in uranium exploration, development and evaluation activities, with its operations concentrated in Canada. The Company owns a 100% interest in the Rook I project, which consists of 32 contiguous claims totaling 35,065 hectares. Nexgen Energy Ltd. is committed to advancing the world's largest development uranium project and holds a portfolio of prospective uranium projects in Saskatchewan.

Whitehaven Coal Ltd

Whitehaven Coal Ltd develops and operates coal mines primarily in New South Wales (NSW) and Queensland (QLD). The company produces coking coal and thermal coal from its coal mines, which comprise five open cut mines and one large underground mine in the Gunnedah Coal Basin in NSW and the Bowen Basin in QLD. Coal products are sold to international markets, including Japan, Korea, Taiwan of China, Malaysia, Vietnam, Indonesia and Europe.

Viva Energy

Viva Energy Group Ltd is Australia's second largest vertically integrated supplier of refined transportation fuels. The company operates through three business units: Convenience & Mobility, Commercial & Industrial and Energy & Infrastructure. The company also owns and operates the Geelong Refinery in Victoria and supports the fuels, aviation, chemicals and lubricants businesses through a national network of import terminals and depots.

New Hope

New Hope Corp Ltd is primarily engaged in the mining of thermal coal, with two operating mines, the New Ackland Mine and the Bengala Mine.The vast majority of New Hope's production is sold into the seaborne thermal coal export market. New Auckland and Bengala have sufficient reserves to last the life of the mines for decades. In addition, New Hope has significant undeveloped coal resources in Queensland and holds a 20% stake in the Malabar Maxwell metallurgical coal mine.

Stanmore Resources

Stanmore Resources is an Australian resource company focused on the exploration, development, production and marketing of metallurgical coal. Its principal assets include the South Walker Creek and Poitrel mines and Stanmore Resources is committed to being a major supplier of metallurgical coal to the global market, primarily producing metallurgical coal for steelmaking for export to international markets.

Beach Energy Ltd

Beach Energy Ltd is an oil and gas exploration and production company. The company produces oil and gas in five basins in Australia and New Zealand and is a key supplier to the gas market on the east coast of Australia. Beach Energy's portfolio of assets includes strategic oil and gas infrastructure and assets in Australia and New Zealand.

How to invest in ASX energy stocks with Moomoo?

Australian investors looking to invest in energy stocks on the moomoo platform can follow the steps below:

1. Create an account: To create an account with moomoo, you have the option to sign up via moomoo website or through the moomoo app, both of which provide a streamlined and user-friendly registration process.

2. Funding: Once the account has been opened, you will need to transfer funds to your moomoo account. You can do this by connecting your bank account and moomoo supports a variety of deposit methods.

3. Select stocks: With the moomoo trading platform, you have the capability to utilise its search feature to locate Australian energy stocks for investment. The platform offers up-to-the-minute stock prices from various global exchanges, encompassing the Australian securities market.

4. Place trades: Once you've found the energy stocks you want to invest in, you can choose to buy them based on real-time quotes and your investment decisions. You can set up different types of orders, such as limit or market orders. Moomoo provides an intuitive trading interface that makes placing orders simple.

With these steps, investors can conveniently invest in ASX energy stocks on the moomoo trading platform.

Types of energy stocks on the ASX

Energy stocks listed on the Australian Securities Exchange(ASX) can be categorised into three main types:

Oil and gas companies

Oil and gas companies specialise in the extraction and processing of fossil fuels, including oil, natural gas and coal. They are the traditional backbone of the global energy supply, providing energy for industry, transportation and households. The operations of these ASX energy companies typically include exploration, drilling, production, refining, transportation and marketing of fossil fuels. They may involve activities such as offshore drilling, onshore extraction, pipeline construction and natural gas liquefaction.

Renewable energy companies

Renewable Energy is dedicated to the development and utilisation of nature's ever-renewing energy resources, such as solar, wind, hydro, geothermal and biomass. Operations include the design, manufacture and installation of solar photovoltaic panels, wind turbines, hydroelectric power plants and biofuel plants. They may also offer energy storage solutions, such as battery storage systems, and smart grid technologies to optimize energy distribution and management. Renewable energy companies aim to reduce dependence on fossil fuels, lower greenhouse gas emissions and promote sustainable development.

Nuclear energy companies

Nuclear energy companies are those that specialise in the development, application and management of nuclear energy technologies, and whose core business includes the design, construction, operation and maintenance of nuclear power plants, which utilise the energy produced by the nuclear fission process to generate electricity. These ASX energy companies are also involved in the mining, processing, enrichment and supply of nuclear fuel, as well as the safe handling and long-term storage of nuclear waste.

Best ASX energy stocks summary

Trump's policies tend to support the fossil fuel industry, particularly coal and natural gas. This could lead to increased exploration and production of oil and gas in the US, with implications for global energy markets. For ASX energy stocks, this could mean that Australian energy companies that do business with the US will face more intense international competition, but may also benefit from increased demand for energy in the US market.

The RBA's interest rate policy affects the entire economy, including the energy sector. Lower interest rates may reduce the cost of financing energy projects and stimulate investment, while higher interest rates may increase the borrowing costs of energy companies and affect their profitability. The RBA left the Official Cash Rate (OCR) unchanged at 4.35% after its November policy meeting, and RBA President Michele Bullock has repeatedly said that the RBA is not ready to cut rates.

The performance of ASX energy stocks is influenced by a number of factors, including global energy demand, energy price volatility, technological advances, and environmental policies. Trump's policies may have an impact on these factors, which may indirectly affect the performance of ASX energy stocks. For example, Trump's support for fossil fuels may boost coal and natural gas stocks, while relative neglect of renewable energy may adversely affect solar and wind stocks.

FAQs about energy stocks

What is the largest ASX energy company?

The largest energy company on the Australian Stock Exchange is Woodside Energy Group (ASX: WDS). Following the merger with the oil and gas business of the BHP Group, Woodside became the largest energy company listed on the ASX and among the top 10 independent energy companies in the world. The merger significantly increases Woodside's scale and business diversity, enabling it to offer a broader range of energy products and play a more significant role in the global energy transition.

Are ASX energy stocks a good investment?

Australia's energy sector offers a diverse selection of stocks to meet the needs of different investors. Renewable energy stocks are a good option for investors interested in emerging technologies and the green energy transition. For investors willing to take on a higher level of risk, shares in smaller exploration companies may be more attractive. And for those investors looking for a steady dividend, large energy producers may be more in line with their needs. The ideal energy stock should match your investment strategy and financial situation. In conclusion, the suitability of ASX energy stocks for investment needs to be determined by your investment objectives, risk tolerance and financial situation.