Warren Buffett's firm now owns more than 25% of Occidental Petroleum

Billionaire Warren Buffett's company keeps buying shares of Occidental Petroleum, and Berkshire Hathaway now controls more than 25 per cent of the oil producer.

A new filing with the Securities and Exchange Commission shows that Berkshire bought another 2.1 million Occidental shares this week worth about USD 123 million.

The latest purchases give Berkshire more than 224 million shares worth nearly USD 13 billion that have all been purchased over the past year and a half.

And Buffett may not be done buying because the price of Occidental stock is still right around where he bought shares at this week even after a modest 43-cent bump Thursday morning to trade at USD 57.89. Buffett has been consistently buying the stock when it dips below USD 60.

Crude prices are down 13 per cent this year and shares of Occidental are down 8 per cent.

Often, other investors rush into a stock after Berkshire discloses a purchase because of Buffett's remarkably successful track record over the decades. But their enthusiasm may be tempered in this case because Buffett told shareholders at his annual meeting that he has no plans to buy all of Occidental.

But last year, Buffett did get permission from federal regulators to buy up to 50 per cent of the Houston-based oil producer, and Berkshire holds warrants to buy another 83.9 million shares for USD 59.62 apiece, so more purchases seem likely.

In addition, Berkshire also holds 91,964 preferred shares of Occidental worth more than USD 10 billion that it picked up in 2019 when it helped finance Occidental's acquisition of Anadarko.

Berkshire used to hold more of those preferred shares, but Occidental has started redeeming them this year at USD 110,000 apiece to eliminate the hefty dividend the oil producer has to pay on them.

Berkshire owns a portfolio worth several hundred billion dollars that includes major stakes in Apple, Bank of America and Coca-Cola stock. But the Omaha, Nebraska-based conglomerate also owns dozens of companies outright including Geico insurance, BNSF railroad, several large utilities and an assortment of manufacturing and retail firms.