Buffett still a happy buyer of oil shares

Warren Buffett still has an appetite for oil and shares in two of America’s biggest producers of the stuff, Chevron and Occidental.

A US Securities and Exchange filing this week confirmed again that Berkshire Hathaway continues to chase shares in Occidental Petroleum, the mid-level group that is now Warren Buffett’s most actively pursued energy play.

Berkshire Hathaway revealed late Wednesday in the US that it had taken advantage of a dip in the Occidental share price, to snap up another 9.6 million shares.

That took Berkshire’s stake to 16.3% (which would rise to well over 23% if convertible shares held by Berkshire are changed to ordinary Occidental shares. Those convertibles were acquired in a $US10 million financing of Occidental’s $US37 billion takeover of rival group, Andarko several years ago).

Berkshire has been on a spending spree in 2022, its most active period in the market for years.

It spent $US51.1 billion on equities in the first quarter, including an increased $US25.9 billion stake in oil company Chevron Corp.

The latest purchases were made over the past week and cost about $US529 million.

They follow $US336 million of Occidental share purchase by Berkshire last month and $US7 billion in purchases earlier this year.

Following the purchases, Berkshire now owns about 152.7 million Occidental shares worth about $US8.52 billion based on Occidental stock’s Wednesday close, which is down over 21% since it touched its year’s high in May.

However, Occidental’s share prices are still up over 90% this year in the wake of the Russian invasion of Ukraine and the boost that gave to oil prices, as well as the steady buying by Buffett’s company

Apple remains Berkshire’s biggest holding, but the stakes in Chevron and Occidental are in the top 10 of the company’s huge portfolio.