Oil prices hit a five-month high, with the West Texas Intermediate crude oil price up 2.8% overnight to $78.82 per barrel, rising on supply side risks of wider and more aggressive US sanctions on Russian oil, according to a Tuesday note from Euroz Hartleys.

The recent Russian sanctions target large exporters, insurance companies, and over 150 oil tankers. There is speculation that the sanctions are meant to potentially force refiners in India and China to source alternative supplies.

Oil prices have experienced a strong start in 2025, spurred on by cold weather in the northern hemisphere, falling US stockpiles, and speculation that the incoming Trump administration in the US could tighten curbs against oil from Iran in the coming months.

Woodside Energy (ASX:WDS), Beach Energy (ASX:BPT), and Karoon Energy (ASX:KAR) are key energy companies listed on the Australian Securities Exchange leveraged to the oil price.

Euroz Hartleys noted that Woodside Energy's revenue stream is 70% linked to oil. The firm is trading on a 4x enterprise multiple and a 7.5% trailing dividend yield, strong leverage to oil price and payout of shareholder returns.

The note added that Santos' (ASX:STO) capital expenditure cycle is more than likely to be extended with a number of major projects to be sanctioned.

Meanwhile, Beach Energy's pricing is 64% oil-linked, and its Waitsia growth project in the Perth basin is expected to come online in the current half, following a strategy reset.

Karoon Energy is trading very cheaply at 1.4x enterprise multiple. Its revised capital management framework includes a shareholder returns policy of 20% to 40% of underlying net profit after tax. In addition, it also includes further capital returns in the absence of alternative, value-accretive uses of cash.

The firm is also facing some negative sentiment due to some production issues and a recent cut to production guidance, according to the note.

Woodside Energy's shares were up almost 1% in recent Tuesday trade, while Karoon Energy's shares were down almost 2%.