If you’ve been keeping up with the news lately, you know tensions in the Middle East have been escalating significantly. While they’ve calmed down for the moment, as long as conflict continues raging in the region, it’s only a matter of time before the next major flare-up. Moreover, production cuts from OPEC+ and sanctions on major oil producers like Russia can only mean oil will keep trading at elevated prices in the future. Venezuela also got slapped with sanctions recently, so oil stocks are a great investment right now.

However, some of the best bets might be more under the radar than you think. Companies with connections to the oil industry that are less talked about can deliver significantly higher returns since they’re trading at very cheap levels. These aren’t pure-play oil stocks, but their ties to the sector still make them compelling oil investments.

Plains All American Pipeline (PAA)

Plains All American Pipeline (NASDAQ:PAA) is a master limited partnership playing a key role in crude oil transportation within the United States and Canada. The company engages in vital activities like pipeline transport, marketing and storage of liquefied petroleum gas and petroleum. PAA stock has been outperforming significantly of late despite poor historical results. This impressive performance is largely attributable to America’s ongoing industrial and infrastructure boom, alongside the push towards onshoring and reducing dependence on foreign oil.

Although modestly valued with a forward P/E of 14, a major plus for PAA is its high dividend yield of 7%, even amidst the stock’s strong run. It’s worth remembering this stock has trounced all benchmarks across the past three years thanks to a decisive shift in energy policy – a transformation unlikely to reverse course anytime soon. Even if we see a change in administration, Trump would probably keep tailwinds blowing for PAA since he has already signaled plans to unleash domestic drilling and production as soon as he takes office.

The total estimated CapEx for 2024 is at $600 million. In comparison, EBITDA of ~$2.75 billion leaves PAA with huge cash flow to either strengthen its balance sheet or reward shareholders directly via dividends.

Dynagas LNG Partners LP (DLNG)

Dynagas LNG Partners (NYSE:DLNG) transports liquefied natural gas (LNG) worldwide through sea. The company owns and operates a fleet of six LNG carriers with a total carrying capacity approaching 1 million cubic meters. DLNG provides reliable performance to charterers and stakeholders.

While Russia does produce natural gas, most LNG imported by Europe and other Western nations comes from Qatar in the Middle East. This means LNG must pass through the Strait of Hormuz, so any conflict with Iran could cause shipping expenses and natural gas costs to surge upward. Tensions in the Red Sea have already triggered increases, alongside the threat of rare but possible Somali pirate attacks.

Despite appreciating 25% year-to-date, I see a massive remaining upside for DLNG since shares trade at a paltry 2.7 times forward earnings with steady profits that should let the company pay down debt and return substantial cash to shareholders.

Ardmore Shipping Corporation (ASC)

Bermuda-based Ardmore Shipping (NYSE:ASC) specializes in the seaborne transportation of refined oil products and chemicals internationally. Their fleet of 22 owned plus four chartered vessels includes Eco-design and Eco-mod ships serving major oil companies, chemical producers and pooling providers.

Much like LNG carriers, Ardmore benefits from elevated shipping expenses caused by Middle East tensions, especially in vital chokepoints like the Strait of Hormuz and Bab el-Mandeb. ASC moves massive amounts of crude oil through the same narrow passages.

Although already up 370% since 2022, ASC still has a substantial upside. The stock has been flat over the past year but remains inexpensive. The juicy 5.7% forward dividend yield is also extremely attractive.

Beyond dividends, ASC boasts stellar 29.5% margins that beat 91% of industry peers. Alongside dividends, the company has substantially reduced debt and maintains a superb cash-to-debt ratio of just 0.5x. Yet, shares trade at only 5 times forward earnings.

On the date of publication, Omor Ibne Ehsan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.