BRK, OXY Update -- June 18, 2024

Locator: 47832OXY.

For oil bulls, there are few things more bullish than a story reporting Warren Buffett buying more OXY. 

BRK is tracked here.

WTI: a bit volatile in the past two weeks, but WTI is now ... now ... now clearly trending higher, trading above $81 for the first time in a long time (I wonder if CNBC is reporting that -- I'm not watching CNBC today -- reading instead -- ).

OXY / BRK: stakes raised to 29%. Link here.

Berkshire Hathaway has recently bought another nearly 3 million shares in Occidental Petroleum, boosting its stake to almost 29%, Warren Buffett’s conglomerate said in an SEC filing this week.  

Over the three trading days to June 17, Berkshire Hathaway acquired as many as 2,947,611 common stock of Oxy, at a price of around $59 each.

Let's see how CNBC is reporting this story: 

• every trading day from June 5, 2024 - June 17, 2024
• added an additional 7.3 million shares
• averaged just under $60 / share
• now: 255 million+ shares; a 28.8% stake in the company
• BRK's 6th largest holding
• BRK is OXY's biggest institutional investor by far
• but also, BRK
• owns $10 billion of OXY in preferred stock
• owns warrants to buy another 83.9 million shares for $5 billion, or $59.62 each

Ticker for one year:

BRK is going to need a very, very good year in energy to beat the S&P this year. 

But I think BRK can do it:

• tech will correct, bringing the S&P with it (unless the Fed cuts rates more than expected, and the market takes off yet again); and,
• WTI holds above $80 through September, and E&P companies respond in kind.

But it will be close.