Energy stocks fizzled over the past three years as the price of oil plunged. But with oil prices topping $70 per barrel in May for the first time since 2014, undervalued ­energy stocks could be poised for strong multiyear gains.

Here’s why: Stronger economic growth in both developed and emerging markets has led to greater oil consumption. At the same time, supply has tightened because the OPEC ­cartel and non-OPEC members such as Russia agreed to cut overall oil production by 1.8 million barrels per day in order to push up prices.

In addition, the US plan to pull out of the Iranian nuclear deal and reimpose economic sanctions on that country could force Iran to cut oil exports, perhaps by hundreds of thousands of barrels per day. Any resulting shortfall could not be made up by increased production from US and European oil companies for at least one year because many of them cut back on exploration and new drilling projects over the past few years.

How to play energy stocks now: In the past year, the price of oil has bounced back strongly. The smart way to invest for continued strength is to look to select oil producers and oilfield-service companies that can quickly expand their operations to take advantage. My favorites now…

Occidental Petroleum (OXY) is the largest shale oil driller in the immense Permian basin, with more than 650,000 acres and thousands of potential sites that will cost relatively little to drill so the company can ramp up its production rapidly.

Halliburton (HAL) provides rigs, equipment and technology for most major shale oil producers in North America. Its revenue grew 34% year-over-year in the first quarter of 2018 as the shale industry ratcheted up its activity.

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