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Tickers in this Article: USO, WFT, PCZ, SU, PBR, RIG, DO
The United States Oil Fund ETF (NYSE:USO) bottomed out, along with the price of crude back in February. Since then, plays on oil have proven to be among some of the most profitable investments. Here are the five best performing oil stocks with a market cap of at least $10 billion during the first-half of 2009. (For a primer on the oil industry, refer to our Oil and Gas Industry Primer.)

Drilling Overseas
The Switzerland-based oil and gas services company, Weatherford International (NYSE:WFT), has seen its shares experience a sharp recovery since hitting a new 52-week low late last year. Year-to-date, the stock is up 86%, making it the top performer in this group, as we approach the close of the first-half of 2009.

Weatherford is coming back from a rocky Q1, in which its earnings were dragged down by a decreased appetite for crude oil in the U.S. and by a relatively strong dollar. There have been some positive trends setting up for the company though. The most notable was a 28% increase in international revenue, despite a slight decrease in the firm's rig count.

The Canadian oil and gas company, Petro-Canada (NYSE:PCZ), has also produced lights-out returns for its shareholders so far in 2009. The stock has climbed 75% this year. Shares of Petro-Canada have soared since the company announced its intention to merge with Suncor Energy (NYSE:SU) in March. Suncor shareholders have also benefited since this announcement was made. Their investments have appreciated 56% year-to-date.

Going Down to the Well
The number-three performing oil stock in the first-half with a market cap north of $10 billion hails from south of the equator. Brazil-based Petrobras (NYSE:PBR), which is up 65% so far this year, topped analyst expectations when it reported its Q1 results last month. The company noted that its earnings suffered from a decline in demand and a drop in oil prices. Quarterly earnings fell 20% on a year-over-year basis, but the company has maintained a competitive cost structure.

Another Switzerland-based oil play that was able to crack the top five is Transocean (NYSE:RIG). The deepwater driller has seen its stock price soar 64% in 2009, even though it reported Q1 results in May that included a 4.6% decline in quarterly revenue and a large write-down relating to two semisubmersible rigs being held for sale. A drop in drilling activity has enabled the company to reign in its operating and maintenance expenses.

Suncor came in fifth in this space during the first-half of 2009, but given its merger with Petro-Canada, we'll look at the next-best performing stock in this category, which has been Diamond Offshore Drilling (NYSE:DO). The only U.S.-based company on this list has had its stock price rise by 47% in 2009. This deepwater driller announced a solid Q1 in April, as diluted EPS rose 20.1% on a 12.7% increase in revenue versus last year's same quarter.

The Bottom Line
After the price of crude rose to record levels last summer, oil plays racked up losses of epic proportions. Now, with the price of crude rallying back above $70 a barrel, some of these investments have gone a long way in making up for lost market value. These large cap oil stocks have produced first-class returns in the first-half of the year. As 2009 nears its conclusion, we will revisit this space to see if any others have also caught fire. (Learn about factors that affect oil prices in our article, What Determines Oil Prices?)

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