What happened
Occidental Petroleum (NYSE: OXY) benefited mightily from its association with celebrated financier Warren Buffett on Tuesday. On news of Buffett’s Berkshire Hathaway (NYSE: BRK.A)(NYSE: BRK.B) upping its stake in the oil and gas mainstay, Occidental’s share price climbed more than 4% on Tuesday. That was more than good enough to beat the 0.2% slip of the S&P 500 index on the day.
So what
In a regulatory document filed Monday night, Berkshire disclosed that it increased its Occidental holding. It did so in a series of purchases made that day and the preceding Thursday that garnered it 3.7 million shares.
This pushed its stake in the energy company to roughly 23.6%; all told, it currently holds just under 212 million shares with a collective market value of $13.2 billion.
Berkshire has been an eager buyer of Occidental for some time now. It began making significant purchases of the stock slightly more than a year ago, around the time when Russia launched its war in Ukraine. That move was immensely disruptive to the oil and gas sector, Occidental included.
Now what
Investors weren’t only cheered by the fact that Buffett/Berkshire dived more deeply into Occidental in the waning days of March.
Last August, Berkshire obtained permission from the Federal Energy Regulatory Commission to purchase up to 50% of Occidental. So the March buys are likely not the final purchases Berkshire is going to make, particularly if the oil price holds its strength or rises.
As is its habit with most of its equity investments, Berkshire hasn’t offered any immediate comment on its latest Occidental buys. The oil and gas company also hasn’t made an official statement on the matter.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool has a disclosure policy.
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