Unleashing Buffett’s Next Buying Spree

You don’t get a nickname like the Oracle of Omaha by being an ordinary investor, and you certainly don’t amass a $155.4 billion fortune by investing like one. 

But if you think Warren Buffett’s personal cash horde is impressive, it’s a pittance compared to the $334 billion that has piled into the coffers of Berkshire Hathaway recently. This has led to intense speculation as to Warren Buffett’s motives, and even more tantalizing teasers of what he plans to do with it. 

After all, Berkshire sold roughly $134 billion in stocks last year, and Uncle Warren has had to sit on his mountain of paper watching in envy as the S&P 500 climbed higher and higher, with its latest all-time high reaching 6,100 in early December. 

Among his two biggest holdings that were cut were Apple and Bank of America. Not surprisingly, it’s another one of Berkshire’s biggest positions that not only weren’t cut, but added to… so what does he know that the market doesn’t?

Well, Uncle Warren has a knack for timing his trades, and this year he may finally be ready to unleash his buying spree. 

Warren Buffett loves oil stocks.

I’ve said it many times before, and at some point it’ll sink into the herd’s mentality. Of all the sectors in today’s market, energy holds a very special place for Buffett. After all, at the young age of 11, the first trade Buffett ever made was an oil stock. 

Decades later, Berkshire started building its position in Occidental, which just so happened acquired Buffett’s first oil stock, Cities Service, back in 1982. 

But Buffett has a keen sense of timing when it comes to his energy investments. 

Back in 2010, just as the Bakken tight oil play was booming, Berkshire bought Burlington Northern Santa Fe railroad for a cool $44 billion. It was a brilliant move considering that pipeline capacity in North Dakota was hitting full capacity, and companies had to find other means to transport their precious crude cargo. 

There’s a reason Berkshire now owns about 28% of Occidental Petroleum after bolstering its position during the last quarter, and it may be a signal of where the 2025 spending spree will take place.

Consider it Buffet’s escape plan.

And there’s no need to ask why…

Precious Canadian Crude

After all the fiery rhetoric that President Trump directed towards Canada over future tariffs, it didn’t take long for him to recognize how precious Canadian crude is to the United States’ energy security. 

It may be one of the few advantages they can hold over the Trump administration. 

For a quick refresher, just keep in mind that we buy more than four million barrels per day from our friendly neighbors to the north, and the heavy quality of that crude is what makes it so attractive to our refineries along the Gulf Coast:

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Remember, one of President Trump’s biggest priorities is to lower energy prices; he knows full well that it won’t happen by putting a 25% tariff on our largest source of oil. He understands this more than most people will give him credit, too. 

Using the tariff stick didn’t work, so now it’s time for the carrot. 

You may have even caught a glimpse of this new tactic recently in the headlines. As it turns out, President Trump is once again opening the door for a nearly forgotten project that would bring more Canadian crude down to the Gulf Coast — the Keystone XL pipeline. 

When Trump hinted that he wanted to resurrect the Keystone XL project, our ears immediately perked up. This pipeline revival also happens to coincide with last year’s Trans Mountain pipeline extension completion last May, which boosted pipeline capacity from Alberta to the coast of British Columbia to 890,000 barrels per day. 

If completed, the Keystone XL pipeline would transport 830,000 barrels per day from Alberta to our refineries along the Gulf Coast. 

And it would also give Buffett his chance to find those investment gems hiding in plain sight in the Canadian oil patch that are trading at the attractive values he loves so dear.