Occidental Petroleum Underperforms, Excluded from Berkshire’s Core Holdings
In his first annual letter, Greg Abel singled out Occidental Petroleum as underperforming and excluded it from Berkshire Hathaway’s core holdings. U.S. crude futures rose to $75.89 a barrel as Iran conflict halted tanker traffic through the Strait of Hormuz, lifting energy stocks.
1. Abel’s Exclusion of Occidental Petroleum
In his first shareholder letter as CEO, Greg Abel named Apple, American Express, Coca-Cola and Moody’s as long-term core holdings with limited activity and high confidence. Occidental Petroleum and Kraft Heinz were specifically called out as having underperformed relative to expectations and were omitted from this prioritized list.
2. Crude Futures Jump on Iran Conflict
U.S. crude oil futures climbed to $75.89 a barrel after tanker traffic through the Strait of Hormuz was suspended for a fourth day due to the U.S.-Israel confrontation with Iran. That surge propelled five energy stocks into the top ten S&P 500 performers, reflecting widespread gains across the sector.
3. Implications for Occidental Petroleum
The criticism from Berkshire’s incoming leadership may intensify scrutiny of Occidental’s operational strategy and returns, even as higher oil prices bolster revenue prospects. Investors will be watching management’s response and any adjustments to capital allocation or production targets.