As Iran Keeps Oil Markets on Edge, 3 North American Pipeline Stocks Look Hard to Replace

The war with Iran has been the dominant storyline in the oil markets this year. Iran has attacked oil infrastructure across the Persian Gulf and has effectively closed the Strait of Hormuz to tanker traffic. These developments have fueled a sharp rise in oil prices.

While the war has disrupted seaborne oil shipments from the Persian Gulf, U.S. oil exports are at record highs. They'll likely remain elevated even after the war, as more countries seek to diversify their energy supplies to prevent future disruptions. That should benefit leading North American pipeline companies. Here are three energy companies with irreplaceable infrastructure crucial to fueling the global economy.

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Enbridge

Enbridge (NYSE: ENB) operates North America's longest and most complex crude oil and liquids transportation system at over 18,000 miles. The Canadian company transports about 30% of the crude oil produced in North America and operates crucial export terminals. Additionally, Enbridge is a leader in natural gas transportation, moving 20% of the gas consumed in the U.S. and serving 25% of the liquefied natural gas (LNG) export capacity along the U.S. Gulf Coast.

The energy infrastructure giant has lined up 39 billion Canadian dollars ($28.4 billion) of expansion projects, including oil pipeline and terminal expansions, new natural gas pipelines, and an investment in an LNG export terminal. These and other projects should fuel Enbridge's growth through the early 2030s.

Enbridge expects to grow its cash flow per share by about 3% this year and by around 5% annually thereafter. That should give it plenty of fuel to continue increasing its high-yielding dividend (5.4% current yield), which it has done for 31 consecutive years (in Canadian dollars).

Enterprise Products Partners

Enterprise Products Partners (NYSE: EPD) operates an integrated footprint of critical energy midstream infrastructure in the U.S. Its pipelines, processing plants, storage facilities, and export terminals support the flow of oil, natural gas, natural gas liquids (NGL), refined products, and petrochemicals to global markets.

The master limited partnership (MLP) -- an entity that sends a Schedule K-1 Federal Tax Form each year -- has invested billions of dollars over the past few years to build new pipeline systems and marine terminals to support growing global energy demand, including $6 billion of projects that entered commercial service in the second half of last year. Enterprise Products Partners currently has another $4.8 billion in major growth capital projects under construction, including Phase 2 of the recently built Neches River Terminal and expansions of the Enterprise Hydrocarbons Terminal and the Bahia NGL pipeline. These and other projects should enter commercial service by the end of next year.

Enterprise Products Partners' expansion projects will grow its cash flow over the next few years. That should support continued growth in its high-yielding distribution (currently yielding 5.9%). The MLP has raised its payout for 27 consecutive years, including a 3.6% increase over the past year.

Plains All American Pipeline

Plains All American Pipeline (NASDAQ: PAA) is a leading North American oil pipeline company. It operates over 20,000 miles of pipelines that transport crude oil from Canada and several U.S. oil basins to the U.S. Gulf Coast. The company moves more than 9 million barrels of oil and natural gas liquids each day.

The MLP -- alternatively, investors can choose Plains GP Holdings (NASDAQ: PAGP), which holds a 28% interest in PAA and offers a 7.1% dividend yield -- has significantly enhanced its oil pipeline operations over the past year. Plains bought the EPIC Crude Oil Pipelines (renamed Cactus III) in a two-part deal and another 20% interest in BridgeTex Pipeline Company. The company is also selling its more volatile Canadian NGL business. This portfolio upgrade positions it to generate steadier and growing cash flow in the future.

Plains has the financial flexibility to continue investing in its oil pipeline operations, including organic expansion projects ($300 million to $400 million per year) and bolt-on acquisitions. These growth drivers should give the pipeline company the fuel to continue increasing its high-yielding payout (currently 7.7%). It gave investors a 10% raise in 2026.

Cashing in long after the war ends

While Iran has disrupted oil exports from the Middle East, the U.S. export market is booming. That will likely continue long after the war ends, benefiting leading North American pipeline companies such as Enbridge, Enterprise Products Partners, and Plains All American Pipeline. Their irreplaceable infrastructure will become even more crucial to the global energy market, enabling these pipeline stocks to generate more cash to support their rising dividends.

Matt DiLallo has positions in Enbridge and Enterprise Products Partners. The Motley Fool has positions in and recommends Enbridge. The Motley Fool recommends Enterprise Products Partners. The Motley Fool has a disclosure policy.