Warren Buffett"s $13B Occidental Bet Takes 29% Dive Since April

Warren Buffett's investment in Occidental Petroleum has faced significant challenges, with the company's shares dropping 29% since mid-April. This decline is attributed to a 23% fall in crude oil prices, driven by concerns over demand and excess supply. Buffett's Berkshire Hathaway holds a 29% stake in Occidental, having accumulated shares since early 2022, with a notable buying spree in June at around $60 per share. The average purchase price for Berkshire's stake is estimated at $51.22, which is slightly above the current trading price of $50.99. The stock's recent performance has breached a critical support level that had held for over two years, raising concerns about the future of Buffett's investment. Additionally, Buffett holds warrants to buy 83.5 million shares at a strike price of $59.62, which is nearly 20% above the current market price. This situation has led analysts to speculate whether Buffett might consider purchasing more shares despite the downturn. Buffett's investment strategy has come under scrutiny amid broader market movements, including his recent reduction of stake in Bank of America, where he sold nearly $7 billion in shares since mid-July. Despite these setbacks, Buffett's reputation as a savvy investor remains intact, as evidenced by Berkshire Hathaway's achievement of a $1 trillion market cap on his 94th birthday. Reflecting on past investment decisions, Buffett has acknowledged missed opportunities, such as his late investment in Amazon, demonstrating his humility and willingness to learn from experience. The current situation with Occidental Petroleum highlights the volatility of the oil market and the challenges even seasoned investors face.