Matt DiLallo, The Motley Fool
4 min read
The energy sector is off to a roaring start in 2026. Crude oil prices have rallied over 15% to start the year. That’s fueled a more than 20% gain in the average energy stock in the S&P 500.
I think the energy sector has plenty of fuel to continue rallying in 2026 and beyond. That’s why I plan to continue buying energy stocks this March. The first one I plan to purchase is Energy Transfer (NYSE: ET). Here’s why I can’t wait to add to my position in the master limited partnership (MLP) this month.
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Energy Transfer’s earnings growth rate slowed last year due to the impact of lower oil prices, fewer organic expansion project completions, and no new acquisitions. However, this year will be a much different story. Energy Transfer expects to generate between $17.5 billion and $17.9 billion of adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) this year. That implies 9.2% to 11.7% year-over-year growth from last year’s level. That’s a major acceleration from the 3.2% earnings growth rate Energy Transfer delivered in 2025.
In addition to the impact of higher oil prices, Energy Transfer expects to benefit from the completion and ramp-up of several expansions. It completed its Nederland Flexport NGL expansion last year. Meanwhile, the company expects to complete its Mustang Draw I & II plants, phase I of its Hugh Brinson Pipeline, and several projects to supply gas to data centers in 2026.
Additionally, both its affiliated MLPs recently closed acquisitions. Sunoco LP bought Parkland in a $9.1 billion deal, while USA Compression Partners closed its $860 million acquisition of J-W Power.
Energy Transfer should continue growing at an accelerated rate in the coming years. It’s investing between $5 billion and $5.5 billion into growth capital projects this year. That capital will help fund expansions entering service this year, as well as those with later in-service dates.
For example, Energy Transfer expects to finish phase II of the $2.7 billion Hugh Brinson pipeline early next year, while completing the $5.6 billion Transwestern Pipeline expansion project in the fourth quarter of 2029. Overall, Energy Transfer has projects scheduled to enter commercial service through the first quarter of 2030.
