NEW YORK ( TheStreet) -It's time once again to select our top oil stocks for the coming year. Last year saw some interesting energy developments, all of which were sidetracked by the BP oil spill -- and made predictions for the year impossible.Barring something unforeseeable like that, however, 2011 promises to be a great year for energy, with a rising crude price and what I believe will also be a breakout year for natural gas in sharp contrast to most energy analysts out there who see natural gas as remaining flat for the coming 12 months. So, let's get to the picks.
Another beaten-up stock that might represent a more speculative play on a rising price of crude would be small SandRidge ( SD), moving from a natural gas to more "oily" assets last year and so far not realizing much confidence in its stock price. In 2011, that could change and make for a big percentage win on an investment in them now.
The recent "fracking ban" imposed by Gov. Patterson on Marcellus shale leases in New York has been part of the reason that "natty" has rallied from $3.50 to stand today nearer to $4.40. I've called for the pressures from environmentalists to increase while the demand for gas to similarly ramp -- a cocktail I reckon will send gas prices to a peak level of $7 dollars next year. If that happens, you'll see some tremendous gains from dedicated natural gas companies, of which Devon ( DVN) remains my favorite. Another smaller choice for those looking for a riskier play with greater possible upside is Cimarex ( XEC) with quality Permian basin exposure. So, there you have it - my energy stocks for 2011. All of my picks have exposure to the price of the underlying commodities and are levered to my prediction for higher prices in both crude and natural gas. As I've always advised, betting on a commodity price is best accomplished by the average investor by investing in stocks. And if energy prices continue to rise, the few I've given here should work well.