4 Energy Stocks for Midterm Elections That Could Go Either Way

Polls open Tuesday with prediction markets already leaning one way, as Polymarket traders were pricing a Democratic sweep of both chambers at about 71 percent, a Democratic House with a Republican Senate at 24 percent and a Republican sweep at 5 percent.

It is a long way from February, when Republicans had about a 60 percent chance of keeping the Senate on both major markets, and the slide since the Iran war began on Feb. 28 has followed rising gas prices and a sinking approval rating for President Donald Trump more closely than any campaign event.

A 5 percent shot makes a better lottery ticket than an investment thesis, so a Republican sweep doesn’t get a pick here, and what follows is two energy stocks for each of the other outcomes, with the understanding that Trump keeps his veto either way and a good deal of whatever Congress tries will end up in front of a judge.

The Russian diesel tanker due in New York in the coming days is the case in point, because its five-year customs penalty window, as Oilprice.com reported, does not care who controls the Senate, and six senators and a House member have already asked banks and ports to preserve their records.

The Senate Votes, the Governor Signs

The politics of power bills started a year ago, when electricity costs became a key issue in the governor’s races in New Jersey and Virginia and Democrats ousted two Georgia utility commissioners, and by this fall both parties had settled on the same villain. NPR counted 127 Democratic ads against data centers and 67 Republican ones, which is about as bipartisan as this election gets.

In the Senate, a Republican-backed bill on who pays for the grid upgrades data centers need was blocked on a 57-43 vote after Democrats called it optional. “They want it optional, which means zero. We want it mandatory,” Senate Minority Leader Chuck Schumer, D-N.Y., said, while Ohio Sen. Jon Husted, the Republican who wrote it, told reporters it gave his party a chance to show it was serious about electricity prices.

Husted’s own race explains why the bill got a vote at all, since Democrat Sherrod Brown has called him the “face of data centers” in Ohio and Senate Republicans’ campaign arm sees the issue as a sleeper that could cost him the seat. Michigan offers a rougher lesson, where opposition to the buildout helped a leftist beat two better-connected Democrats in a primary and, by the winner’s account, united Republicans, Trump voters, independents and Democrats.

The Iran war has run on a similar track, with the Senate voting on war powers resolutions 14 times since Trump launched the conflict on Feb. 28 and yet to make one stick, and Trump says he expects fighting to resume after the midterms even as Vice President JD Vance works to restart talks. Oil traders are already bracing for escalation after the vote, and a Democratic Congress could hold more hearings and issue more subpoenas than this one without turning either into a ceasefire over a presidential veto.

The real switches belong to governors, as Texas Gov. Greg Abbott, who called his state the epicenter of AI development last year, showed when he ordered regulators on Aug. 3 to stop approving new data center grid connections and then told the state’s environmental agency on Sept. 21 to hold their permits too, saying Texans must come first.

The pause reaches about 300 large projects but not medium-sized or smaller ones, or parts of the state off the ERCOT grid, and the audit it hangs on isn’t expected to wrap until mid-December, roughly six weeks after voters decide whether Abbott gets a fourth term against Democrat Gina Hinojosa, in a state that hasn’t elected a Democratic governor in more than 35 years.

Hinojosa says the pause could end in a day and nobody believes it, and Trump has called saying no to data centers a mistake, arguing the industry could end up bigger than oil for the state. So far one governor’s letters have held up more megawatts than the Senate’s roll calls, which is not a sentence anyone will hear on a cable chyron Tuesday night.

If Democrats Take Both Chambers

Any bill a Democratic Congress sends still needs the president’s signature or a two-thirds override, so the useful question is who looks better when the loudest voices in Washington are asking data centers to cover their own costs, and that favors companies that bring their own power or can show regulators the bill won’t land on ratepayers.

Bloom Energy Brings Its Own Power

Bloom Energy Corporation (NYSE: BE) says it got power to an Oracle data center in Utah in under two months, a timeline no utility interconnection queue would recognize, and it is the pitch behind a line in Virginia Gov. Abigail Spanberger’s 2026 energy plan that singled out non-combustion fuel cells for substantially lower local emissions than conventional gas generation. CEO KR Sridhar made a point of applauding her on the third-quarter call.

Bloom is less a beneficiary of any federal bill than a workaround for the political pressure on data center power costs, since its fuel cells sit beside a data center and run without the grid, which leaves the company on the right side of the room when those costs turn into hearing schedules. Revenue rose 138 percent to $1.24 billion in the third quarter, guidance for the year went up for the third time, all in the same stretch that put Bloom in the S&P 500 eight years after an IPO that pegged it as a niche supplier, and Sridhar describes the aim in the company’s release as “power where it is needed, when it is needed, clean and always on.”

The line to watch is cash flow, which ran at negative $27 million from operations and negative $181 million free as Bloom built inventory and waited on customers to pay, a gap CFO Simon Edwards called timing rather than a trend.

Bloom is also more exposed to Austin and Richmond than to anything on the federal ballot, since its first units are headed to Texas this quarter, where Abbott’s permit order does not expressly exclude data centers that make their own power. A fuel cell running on natural gas also still emits carbon dioxide, which Sridhar acknowledges by pitching hyperscalers on carbon capture, and a harder environmental review of upstream gas supply would reach an off-grid project as easily as a grid-connected one.

NextEra Needs Richmond More Than Washington

Spanberger told readers of her Washington Post op-ed she was “deeply skeptical” about selling the state’s main utility to an out-of-state owner, and then she formally intervened in the State Corporation Commission’s review of NextEra Energy, Inc. (NYSE: NEE) buying Dominion Energy in a $67 billion all-stock deal that Virginia regulators must decide within six months of the July 15 filing.

A Democratic sweep wouldn’t change a word of that, but it would make the national mood friendlier to people asking what data centers do to ratepayers, and NextEra has an answer in “hubs” that put multi-gigawatt generation beside data centers and bypass the grid. CEO John Ketchum told analysts the company has advanced “more than 20 gigawatts of large-load projects,” and over 18 gigawatts of that is gas-fired, a figure that should surprise anyone who still files NextEra under solar.

Third-quarter adjusted earnings of $1.24 a share rose 9.7 percent, and Washington appears as a lender, since a Department of Energy loan of up to $1.9 billion supports the restart of Iowa’s Duane Arnold nuclear plant, in a state that also hosts one of the Senate races most likely to decide control.

The bigger risk sits in Richmond, where a governor who wants customers to see real savings is negotiating with a company that has already put $2.25 billion in shareholder-funded bill credits on the table, and the commission has shown it is watching data centers closely, having directed Dominion in August to design a tariff that assigns more future transmission costs to them.

Richmond is also only one stop. South Carolina has set a Jan. 29 deadline of its own, North Carolina, the Federal Energy Regulatory Commission, the Nuclear Regulatory Commission and antitrust reviewers all still have to sign off, and the companies don’t expect to close before the second half of 2027, so the overhang on the shares will outlast whatever happens Tuesday and a rejection anywhere would sink the largest proposed utility merger in U.S. history.

If Republicans Hold the Senate

A Republican Senate facing a Democratic House produces gridlock, and gridlock is a status quo trade, which favors companies whose current business is already working, whether that means selling gas to a world short on it or collecting royalties on West Texas oil, though a Republican Senate does nothing for Austin or Richmond, where a governor’s order or a commission’s schedule can still freeze a catalyst.

Cheniere Missed and Raised

Cheniere Energy, Inc. (NYSE: LNG) missed earnings estimates and raised its full-year guidance on the same day, and the stock rose anyway. Adjusted earnings of $3.62 a share fell short of consensus, but the company lifted its 2026 EBITDA guidance to between $8.75 billion and $9.25 billion for the third time this year, and CEO Jack Fusco said the results and the stronger outlook gave Cheniere better visibility into 2027 production.

Much of the increase came from wartime pricing, with about $250 million of it traced to netbacks more than doubling, which ties the raise far more closely to the Strait of Hormuz than to anything on a ballot. QatarEnergy’s deal looks like portfolio management by comparison, since the company, which sells LNG for a living, agreed on Oct. 22 to buy 4 million metric tons a year from Cheniere at a price indexed to Henry Hub plus a fixed fee, with deliveries starting in the early 2030s and its chief executive, Saad al-Kaabi, describing it as a way to diversify the company’s LNG supply.

Part of that volume depends on a decision still ahead, since 1 million tons of the Sabine Pass contract is contingent on a final investment decision for an expansion expected in early 2027, and the Republican Senate case is that a chamber that keeps voting down war powers resolutions leaves the market behind those margins mostly alone while a divided Congress, with a veto looming over it, can’t do much else. The risk runs the other direction, because the margins shrink if prices normalize, whether through a peace deal or new supply, and Vance has already started writing to Iranian hard-liners.

Texas Pacific Land Just Owns the Dirt

Texas Pacific Land Corporation (NYSE: TPL) CEO Tyler Glover told investors in May that the company’s unhedged position would let it “fully capture the upside from elevated commodity prices,” which has been a fair description of 2026 for a company that owns close to 900,000 acres of West Texas and collects on whatever crosses it.

In the second quarter TPL posted record revenue of $246.1 million, agreed to supply land and water for Project Kilby, the power plant Chevron Corporation (NYSE: CVX) is building for a customer’s data center in Reeves County, and spent about $110 million on land in Shackelford and Jones counties. Management said on the earnings call that the Jones County tract suits developers because it combines contiguous land, water, natural gas, fiber and a mid-sized city nearby, which is about as close as real estate gets to a wish list.

A divided Congress is about the best case for TPL, since it leaves royalties to ride on prices without much interference from Washington, though the water business has softened, with volumes down 19 percent from the first quarter as weak in-basin gas prices pushed some operators out of the Delaware Basin. Royalty volumes still set a record in the second quarter, but a longer stretch of cheap gas would test them, and the data center half of the story runs through a governor’s audit that doesn’t end until December.

By Wednesday morning somebody on cable will have credited or blamed Congress for the future of American power, while an auditor in Austin and a commissioner in Richmond keep reading the same stack of filings they were reading on Monday.

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