InvestorQ : Is it true that Warren Buffett has been buying a lot of oil stocks in the last few months?
swati Bakhda made post

Is it true that Warren Buffett has been buying a lot of oil stocks in the last few months?

Sam Eswaran answered.
10 months ago

Things change quite fast in the investment world. Just about 5-6 years back, Warren Buffett had complained that there were not enough buying opportunities in the stock market and hence he was sitting on a huge pile of $147 billion in cash. In the Mar-22 quarter, the cash pile of Berkshire Hathaway receded to $106 billion; a fall of $41 billion. Obviously, that is the money that got invested in stocks, but there was more that was actually invested.

In the Mar-22 quarter, Berkshire Hathaway bought stocks worth approximately $51 billion, which included $41 billion by way of using up cash reserves and an additional $10 billion came from sale of shares and other internal sources. While Apple remains the biggest holding of Berkshire accounting for 41% of its equity portfolio, there were other interesting additions made by them in the latest quarter ended Mar-22.

Between Dec-21 and Mar-22, Berkshire Hathaway increased its holdings in Chevron by $21.5 billion. That is not all. Berkshire Hathaway also bought $7 billion of Occidental Petroleum shares, $4 billion of Hewlett Packard and $11.6 billion of Alleghany Corporation, a major insurance player in the US. These four stocks alone accounted for $44 billion or bulk of the stock purchases made by Berkshire Hathaway in the Mar-22 quarter.

Where did the remain $7 billion go? The total buyback of Berkshire Hathaway was not as high as $6 billion in the previous quarters but was still significant at $3.2 billion. In addition, Berkshire also bought about $1 billion of Apple and invested another $1 billion in buying Activision, the gaming company that is now being acquired by Microsoft. Overall, it was a quarter in which Buffett gave up his aversion for buying fresh equities. Its exposure to oil now stands at over $40 billion, one of the highest levels that it has been for the fossil fuel.