This year, Buffett has spent more than $7 billion (about 44.4 billion yuan) to increase his holdings in U.S. oil giants.
According to the documents disclosed by the US Securities and Exchange Commission (SEC), from March 14 to 16, Buffett’s Berkshire Hathaway Inc. (hereinafter referred to as Berkshire) continued to increase its holdings of ordinary shares of American energy giant Occidental Petroleum Corp. (hereinafter referred to as Occidental Petroleum).
This time, Berkshire bought about 18.1 million shares of Western oil at a price ranging from $52.28 to $55.5 per share, at a total cost of $985 million (about 6.252 billion yuan).
This is the third round of Berkshire’s position increase on Western oil since March, with a total capital of US $5.6 billion (about 35.79 billion yuan)
From March 2 to 4, Berkshire purchased more than 61 million shares of western Petroleum common stock at a cost of about US $3.122 billion (about RMB 19.816 billion).
From March 9 to 11, Berkshire purchased more than 27.1 million ordinary shares of western Petroleum, with a cost of about US $1.534 billion (about RMB 9.738 billion).
With 29 million ordinary shares purchased from January 1 to March 1, Berkshire currently holds about 136 million ordinary shares of western Petroleum, accounting for nearly 15% of the shares of western Petroleum, with a total value of more than 7 billion US dollars (about 44.4 billion yuan).
In addition, Berkshire also holds more than 83 million common stock warrants of western Petroleum, with an exercise price of $59.624. Warrants represent the right to purchase shares of the company at a specific price on a specific date.
At present, Berkshire has not exercised this part of the warrants.
Affected by the conflict between Russia and Ukraine and other factors, international oil prices fluctuated sharply this year. On March 8, Brent crude oil futures price once reached $139 / barrel, a new high after July 2008.
Recently, the price of crude oil has fallen from an all-time high to $100 / barrel. On March 17, Brent crude oil futures closed down 1.89% to US $98.02/barrel.
Affected by international oil prices, at the close of March 17, western Petroleum shares fell 2.83% to close at US $52.99 per share, down 7.89% in the past five days, but they have increased by more than 80% compared with the beginning of this year.
Buffett’s recent aggressive investment in oil giants shows that he believes that oil prices will continue to rise. This has fully attracted the attention of the market.
On March 17, Berkshire’s class A shares rose for the fourth consecutive trading day, up 1.18% and closing at about $504000. This is the first time Berkshire’s share price has exceeded the $500000 mark.
Buffett also holds a stake in another oil giant.
In the fourth quarter of last year, Buffett significantly increased his holdings of Chevron. At present, Berkshire holds 38.2 million chevron shares with a market value of about $6 billion.
As of the closing on March 17, Chevron’s share price fell slightly by 0.36% to close at US $157.71/share. So far this year, Chevron’s share price has risen by more than 34%.
Recently, Goldman Sachs raised its estimate of Brent crude oil price in 2022 from $98 / barrel to $135 / barrel.
On March 17, Morgan Stanley raised its Brent crude oil price forecast for the third quarter of this year to $120 / barrel, up from $100 / barrel.
