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An Oil Name Ready to Run

Oil is poised for a long-term rally, Cramer said Tuesday, thanks to increased demand from fast-growing economies around the world.

China, for example, is concerned it won't secure enough oil to fuel its nation. The People's Republic is searching the globe for more sources of crude, and Cramer thinks the influx of Chinese buyers will help drive oil prices higher for the foreseeable future. He noted an increase in demand from India, too.

So what's the best way to play black gold?

Through Hess , Cramer said. The New York City-based company is among the least expensive of the integrated oil and gas names, even though it's less than a point off its 52-week high. It's also the most levered to higher oil prices and has the least exposure to natural gas, the price of which has been falling lately. Seventy-three percent of Hess' reserves are in oil, while 97 percent of the company’s capital-expenditure budget is targeted for oil projects.

Hess is mainly an exploration and production company, Cramer noted. Ninety percent of its earnings come from exploration and production. From the North Sea to France to West Africa and Southeast Asia, Hess combs the world for oil and gas. He likes its mix of both onshore and offshore assets.

For some time, though, Hess' high-risk/high-reward approach to finding oil was criticized. The company was said to have no game plan for locating new reserves. As a result, its stock is trading at a 10 percent discount to other big oil players. Hess now takes a more realistic approach to exploration, Cramer said. In turn, it currently sports a balanced portfolio of onshore and offshore properties both in the U.S. and abroad.

The stock hasn't received credit for its turn around, but Cramer thinks that could soon change. Over the past few years, Hess has rarely released new production information, but it now has a trache of potential announcements from the company’s ongoing projects that could lead them to boost their production forecast.

Cramer thinks Hess could go into the $90s from its $77 perch and recommends buying on a dip.

When this story published, Cramer’s charitable trust owned Hess.

Call Cramer: 1-800-743-CNBC

Questions for Cramer? madmoney@cnbc.com

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