With oil prices elevated as Russia's invasion of Ukraine raises concerns about global supply, Goldman Sachs highlighted its favorite energy stocks. "We raise our oil price outlook as global supply could remain increasingly constrained," Goldman's Neil Mehta said in a note Wednesday. "Within the context of this oil price backdrop, we maintain our bullish view on our US Majors coverage." Russia is one of the world's largest oil producers and exporters. Sanctions and political pressure could significantly reduce Russian energy exports. The U.S. on Tuesday announced it would ban all Russian oil imports in response to the war in Ukraine. Though oil prices eased this week, WTI crude is up nearly 41% in 2022 and international benchmark Brent crude has returned 40.6% this year. Goldman on Tuesday raised its 2022 Brent spot price forecast to $135 per barrel. Given the rising oil price environment, Goldman expects energy companies' profit estimates to move higher and boost share performance this year and next. "We see material upside to consensus, and expect earnings revisions to act as a positive catalyst for shares in 2022/2023," Mehta said. Goldman also sees robust share buyback programs and modest dividend growth for its favorite energy names. "We see room for robust capital returns to shareholders and significant balance sheet repair at our current price deck," Mehta said. Take a look at three of Goldman's favorite energy stocks. (As of market close March 10, 2022). All three of these oil names have a buy rating from Goldman. Goldman likes Exxon Mobil for its focus on high-return projects, capital discipline and share buybacks. The firm set a new price target on the stock of $102 per share, implying 19.5% upside from Thursday's close. ConocoPhillips is another favorite of Goldman. The firm believes ConocoPhillips will benefit from leveraging higher energy prices and recent acquisition activity . "We continue to view transaction execution as one of the company's core competencies," Mehta said of ConocoPhillips. Goldman also highlighted Kosmos Energy , saying the company has "underappreciated FCF (free cash flow) generation." "We continue to see balance sheet improvement in addition to the incremental shareholder returns" from Kosmos, Mehta said. These names are up big this year. Exxon Mobil and ConocoPhillips have rallied nearly 40% this year and Komos is up roughly 80%. — CNBC's Michael Bloom contributed reporting.
A general view of oil tanks in the Transneft-Kozmino Port near the far eastern town of Nakhodka, Russia.
Yuri Maltsev | Reuters
With oil prices elevated as Russia's invasion of Ukraine raises concerns about global supply, Goldman Sachs highlighted its favorite energy stocks.