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13:34 Two core-drivers for Buffett's oil purchases: a). Long-term oil prices will be higher (for longer) than most investors anticipate. b). Very little expenditure (in exchange for) capital growth.
Been an Oil an Gas professional for 25 years. Worked with many of the major producers, Chevron included. I can say the way you E described the business dynamics and the overall higher level view of the industry is correct and the details you discussed are also well researched.
You make a good point he invests big when things are expected to bad. Bring it home- he expects stagflation. And probably hedging dollar inflation down the road as well when Fed pivots and fires up QE again.
Tom mate, we've spoken about this in the past and you said that you don't pay to much attention it as sometimes it'll benefit you, sometimes it won't, but what are you doing with the NZD to USD conversion looking so terrible. The NZD to USD is down 22% over the last 12 months, making it far more expensive for Kiwi's to invest in the US market. Is this affecting your strategy at all? Cheers
Berkshire see's OXY like a coupon paying bond. OXY pays a 1.24% dividend yield and 5.9% buyback yield. Combined providing shareholders a yield of 7.1%. In addition, its rumored that Chevron may acquire OXY due to their positioning on the Permian basin.
Gov is putting trillions into new energy, but transition will take time. And building renewable infrastructure requires traditional fuels, because renewables can't provide instant energy at scale. Yet. So oil companies are doing well. Look at Exxon Mobil!
I attended an industry call at work today with the leader in windmill farms in EU. They can produce 120 turbines a year. And for the UK to offeset energy lost due to russia we need 2500 windturbines. so even with potential of ramping up we are 10years away atleast.
Buffett once say if Berkshire Hathaway after him run by stupid man also Berkshire Hathaway never fails ,he says he needs business which can run by one who didn't know it, like oil company don't need much technology or innovative like apple so oil company can be forever business for Buffet
Excellent video!Mr Buffett is now up to 28% ownership.If he converts his warrants at $59/share,he will own 38%.Converting his warrants would give OXY a cool $5B to strengthen its balance sheet.OXY is well on its way to being investment grade & increasing its dividend.Their carbon capture business opportunity could add $billions in additional revenues.The CEO wants to roll out 130 carbon capture plants by 2035.OXY below $60 looks very interesting as an investment.The stock has a 20% FCF yield at $60 & current FCF.
Inflation hedge! Real assets that are tangible do well in high inflation and uncertainty. I wonder how much similarity he sees in the times now and the 1970’s?
What does Buffett see here? I think it is a bet on oil prices, but there is something else. He is after exposure to the Permian Basin. OXY is the largest acreage owner in the basin and CVX is the second largest. This is Belridge Oil all over again, but on a much larger scale.
@@davejohnson2466 I think Warren would love to own either if these, but unfortunately I don't think it will happen. Warren will only buy companies that want to sell and I don't think either want to be part of Berkshire. I do think he will add to these positions and look for other opportunities in the Permian. When he helped to finance the Anadarko acquisition, he implied that Berkshire may have bought Anadarko if the Anadarko people had brought it to him instead of it coming through OXY.
Oil is very difficult to value in the longer term. People tend to forget that four of the largest potential producers are producing far less than they could: Iran, Iraq, Libya and Venezuela. In addition Guyana is on its way into the market. Oil demand will likely peak around 2035 but it does have a very long tail (industrial use, plastics, fertilizer, lubricants, chem industry, high temp combustion, special fuels etc. etc.)
i think we will be energy independent and other alternative to reduce our own use, so game changed from big import to export has to do with the petrodollor and china and the rest of the world
Can you explain how Charlie Munger didint add or sell baba position but now its reporting a price on 13F at 79.99$ and previous quarter it was reporting like $115-117
The discount is still available! Just had the SWS team check, and everything seems to be working. A note that this is just for new users. If you've signed up using that e-mail before then it might not show the discount. Hope that helps - thanks for supporting the channel :)
Also the global climate is not great and we may have to become more energy independent over the next few years if our leaders allow. It’s going to be interesting!
Additionally we have a larger investment universe than Buffett. If you see him buying oil it could be a good idea to hunt for a smaller and cheaper company that he wouldn't be able to buy in size
@@InvestingwithTom I would suggest calima asx:ce1 seems very cheap it should be hitting over 50 mill operational cash flow per year & 2nd undeveloped asset at the monteray that should be worth quite a bit more than its market cap of 70 million almost no debt & buying back shares & paying its first dividends
Check out Buffett's top 5 stocks for 2022. The first 100 to sign up to SWS get 40% off!
simplywall.st/discover/community-ideas/286320/warren-buffett-top-stocks?via=Tom
13:34 Two core-drivers for Buffett's oil purchases:
a). Long-term oil prices will be higher (for longer) than most investors anticipate.
b). Very little expenditure (in exchange for) capital growth.
Thanks for reminding me that when purchasing a stock, don't focus on upside, but to focus on lack of downside. 20+ year BRK-B shareholder
Been an Oil an Gas professional for 25 years. Worked with many of the major producers, Chevron included. I can say the way you E described the business dynamics and the overall higher level view of the industry is correct and the details you discussed are also well researched.
Thanks. Glad to hear I’m on the right track!
You make a good point he invests big when things are expected to bad. Bring it home- he expects stagflation. And probably hedging dollar inflation down the road as well when Fed pivots and fires up QE again.
Tom mate, we've spoken about this in the past and you said that you don't pay to much attention it as sometimes it'll benefit you, sometimes it won't, but what are you doing with the NZD to USD conversion looking so terrible. The NZD to USD is down 22% over the last 12 months, making it far more expensive for Kiwi's to invest in the US market. Is this affecting your strategy at all? Cheers
Renewables are highly energy inefficient
Berkshire see's OXY like a coupon paying bond. OXY pays a 1.24% dividend yield and 5.9% buyback yield. Combined providing shareholders a yield of 7.1%.
In addition, its rumored that Chevron may acquire OXY due to their positioning on the Permian basin.
Gov is putting trillions into new energy, but transition will take time. And building renewable infrastructure requires traditional fuels, because renewables can't provide instant energy at scale. Yet. So oil companies are doing well. Look at Exxon Mobil!
Yeah, it’s a massive ask. I hope we get there!
I attended an industry call at work today with the leader in windmill farms in EU. They can produce 120 turbines a year. And for the UK to offeset energy lost due to russia we need 2500 windturbines. so even with potential of ramping up we are 10years away atleast.
@@petera4640 that’s a great example. Probably the world’s biggest challenge. Buffett will be well aware of these things through Greg Abel at BHE too
@@petera4640 Are they building bladeless wind power generators?
@@EpochUnlocked they only mentioned blade ones
Thanks for the good video on Buffet and the oil stocks. Liked your points at the end on looking for downside being muted.
Glad it was helpful!
Buffett once say if Berkshire Hathaway after him run by stupid man also Berkshire Hathaway never fails ,he says he needs business which can run by one who didn't know it, like oil company don't need much technology or innovative like apple so oil company can be forever business for Buffet
Excellent video!Mr Buffett is now up to 28% ownership.If he converts his warrants at $59/share,he will own 38%.Converting his warrants would give OXY a cool $5B to strengthen its balance sheet.OXY is well on its way to being investment grade & increasing its dividend.Their carbon capture business opportunity could add $billions in additional revenues.The CEO wants to roll out 130 carbon capture plants by 2035.OXY below $60 looks very interesting as an investment.The stock has a 20% FCF yield at $60 & current FCF.
Hi Tom, would you mind sharing your thoughts on Ally Financial and Buffett's purchase?😀
Great videos Tom. But I dont think I can just call Warren Buffett just Buffett. I would call him Mr Buffett.
How likely to lose when investing in oxy?
I really appreciate your conclusion regarding Buffett getting tons of cash right out of the gate without the company needing to spend a lot of money
Of course we enjoy a content like that, coming from Tom. But i can't subscribe more than once, otherwise i would.
Haha a like will suffice in that case ❤️
Inflation hedge! Real assets that are tangible do well in high inflation and uncertainty. I wonder how much similarity he sees in the times now and the 1970’s?
What does Buffett see here? I think it is a bet on oil prices, but there is something else. He is after exposure to the Permian Basin. OXY is the largest acreage owner in the basin and CVX is the second largest. This is Belridge Oil all over again, but on a much larger scale.
Are you inferring to a potential buyout??
@@davejohnson2466 I think Warren would love to own either if these, but unfortunately I don't think it will happen. Warren will only buy companies that want to sell and I don't think either want to be part of Berkshire. I do think he will add to these positions and look for other opportunities in the Permian. When he helped to finance the Anadarko acquisition, he implied that Berkshire may have bought Anadarko if the Anadarko people had brought it to him instead of it coming through OXY.
You will find your answer by googling TAE Technologies.
Staggering to me isn't Buffett's record $57-Billion stock positions. It's that it's only $3-Billion more than Musk bid for TWTR.😂
Oil is very difficult to value in the longer term. People tend to forget that four of the largest potential producers are producing far less than they could: Iran, Iraq, Libya and Venezuela. In addition Guyana is on its way into the market. Oil demand will likely peak around 2035 but it does have a very long tail (industrial use, plastics, fertilizer, lubricants, chem industry, high temp combustion, special fuels etc. etc.)
This is one of your better videos. Very well done! 👏
13:34 Two core-drivers for Buffett's oil purchases ...
What's the rate of return on $150.00 oil?
Ur not calling me an oxymoron haha❤❤🎉🎉
i think we will be energy independent and other alternative to reduce our own use, so game changed from big import to export has to do with the petrodollor and china and the rest of the world
Can you explain how Charlie Munger didint add or sell baba position but now its reporting a price on 13F at 79.99$ and previous quarter it was reporting like $115-117
13f SEC filings don't have prices. That'll just be a current market price from whatever third party website you're looking at
Thanks for the education on why buffet is buying oxy
With your new knowledge, are you buying any oil stocks Tom?
Cheers
A few on the watchlist
What’s the code for discount Tom?
No code needed - if you use the link in the description you should be able to get the discount
@@InvestingwithTom don't see the discount :(, maybe 100 people have already subscribed.
The discount is still available! Just had the SWS team check, and everything seems to be working. A note that this is just for new users. If you've signed up using that e-mail before then it might not show the discount. Hope that helps - thanks for supporting the channel :)
Also the global climate is not great and we may have to become more energy independent over the next few years if our leaders allow. It’s going to be interesting!
15:40 they paid a lot in dividends? OXY pays .13!
True, they've tended towards buybacks and debt repayment in recent times. Not too long ago they were paying $3/share
If oil stops Apple closes (oil => polymers => plastics). We won’t see that until very old.
It’s in everything! Would be nice to see oil’s use increasingly limited to those high value cases rather than transport etc.
POLO-O-X-PARK SOLD TO PATITAPABANA & PANCHANANA
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What's the point in tracking what Buffett is buying? - if you have that much faith in him take the easy route and buy Berkshire... Job done!
In case Berkshire is over priced and what Buffett is buying is still under priced. Not too hard to understand
Additionally we have a larger investment universe than Buffett. If you see him buying oil it could be a good idea to hunt for a smaller and cheaper company that he wouldn't be able to buy in size
That’s actually a pretty good idea I haven’t thought about, Tom.
I think he accidentally bought it
@@InvestingwithTom I would suggest calima asx:ce1 seems very cheap it should be hitting over 50 mill operational cash flow per year & 2nd undeveloped asset at the monteray that should be worth quite a bit more than its market cap of 70 million almost no debt & buying back shares & paying its first dividends
Top❤
I think Buffet bought OXY because he thought it would keep with inflation.
Love your kiwi accent
🥝
There is one thing though, Buffett does not buy OXY for the oil
Why does he buy it ?
hard core leftist like Buffet buying oil-- priceless.
🙏