Warren Buffett is Backing This Energy Stock For Success
With 14 billionaire investors in the Insider Monkey database at the end of Q1 2025, Occidental Petroleum Corporation (NYSE:OXY) is included among The 5 Energy Stocks Billionaires are Quietly Piling Into.
An aerial view of vast facilities and pipelines in the deserts, illustrating the global scale of natural gas liquids transportation.
Occidental Petroleum Corporation (NYSE:OXY) is an independent exploration and production company with assets primarily in the United States, the Middle East, and North Africa. The company is a leading producer and one of the largest acreage holders in the Permian Basin, with assets concentrated in West Texas and Southeast New Mexico.
Occidental Petroleum Corporation (NYSE:OXY) is known for having the backing of Warren Buffett himself. The Oracle of Omaha made a significant investment in the energy firm back in 2019 and has consistently increased his stake since then. As a result, Berkshire Hathaway now owns an approximate 28% stake in Occidental. However, despite such a large stake, Buffett has publicly stated that he does not intend to take a controlling interest in the company, but it only represents his long-term bet on the enduring importance of oil and gas.
That said, things haven’t been going fairly well for Occidental Petroleum Corporation (NYSE:OXY), and the company has witnessed a sharp decline in earnings and revenue over the last three years. At the time of writing this piece, the OXY stock is also down by more than 30% over the last year, mostly due to its high debt costs, environmental liabilities, and overall market volatility.
Occidental Petroleum Corporation (NYSE:OXY)’s debt problems have been a significant cause of concern for investors, especially after its $12 billion acquisition of CrownRock last year. However, the company is aggressively working to reduce its debt and revealed in its Q1 2025 earnings call that it has repaid $6.8 billion of debt since Q3 last year, exceeding its target and reducing interest expenses by $370 million.
Moreover, Occidental Petroleum Corporation (NYSE:OXY) is actively working to reduce well costs and improve efficiency. The company’s low-cost and long-life production assets in the U.S. will enable it to stay cash flow positive even with crude oil prices in the low $30s per barrel.
If you are curious about the current state of the global energy industry and its top performers according to billionaires, take a look at the complete video here.
https://www.youtube.com/watch?v=1iPhUpALvek&t=396s&ab_channel=InsiderMonkeyVideo