When it comes to investing, some people are just better than others. And self-made billionaire Warren Buffett is simply one of the best. That’s why it’s could be very beneficial to always have at least one eye on the “Oracle of Omaha” and how he’s currently playing the financial markets.
Well, Buffett has made another move…a big one.
It’s time to take note, because this $1 billion bet revolves around one of the most important commodities attainable…
“Black Gold” – that’s the nickname for oil. And that could be exactly what Warren Buffett is seeing right now.
I say this because Berkshire Hathaway (BRKB) has purchased nearly $1 billion in the oil sector…since the start of the year alone!
Clearly, oil’s fall hasn’t deterred BRKB and Buffett from betting on “black gold”, even with headlines suggesting an even lower $20 a barrel on the horizon after dipping down below $30 a barrel recently.
The interesting thing is what part of the oil sector Buffett’s firm is actually invested in…
By purchasing another 12 million shares this year, BRKB added to its previous amount of 61.5 million shares of Phillips 66 (PSX). By owning 14% of the company’s shares, BRKB now makes PSX its 6th-largest holding.
So what exactly is PSX?
PSX is an oil refining company, and one that can actually benefit from falling oil prices. This is because PSX has the ability to buy the crude oil it refines at cheaper prices, but because the price at the pump hasn’t fallen congruent to crude oil, PSX benefits.
All of that allowed PSX to actually boost profits from $1.4 billion in 2014 to $2.4 billion in 2015.
You can see why BRKB likes this oil refining company…
And the fact that Buffett doesn’t have any oil stocks other than PSX is his top 50 holdings makes it even more intriguing.
PSX is clearly a good play in Buffett’s eyes, and that’s a powerful endorsement…
ok thank u