Why Warren Buffett's Favorite Energy Stock Is Sliding Premarket Today

Occidental Petroleum Corp. OXY shares pulled back in premarket trading on Thursday following the release of its quarterly results.

The Houston, Texas-based integrated oil company reported second-quarter adjusted earnings of $0.68 per share on revenue of $6.73 billion. This compares to the year-ago earnings of $3.16 per share and revenue of $10.74 billion.

Analysts, on average, estimated EPS of $0.76.

The declines reflected a fall in energy prices in the second quarter. The WTI-grade crude oil fell 6.7% in the second quarter.

Occidental noted that worldwide realized crude oil prices fell by 1% quarter-over-quarter to $73.59 per barrel. Average global production came in at 1,218 thousand billion barrels of oil equivalent (boed), exceeding the mid-point of the guidance by 42 million boed, it added.

In the 10-Q filed with the SEC, the company said it redeemed preferred shares worth $522 million held by Warren Buffett's Berkshire Hathaway, Inc. BRK BRK.

The preferred shares worth $10 billion were offered to Berkshire to raise finances for Occidental’s 2019 acquisition of peer Anadarko Petroleum.

Berkshire has been accumulating shares of Occidental, and with a series of transactions in late June, the Buffett-led company increased its stake in the energy producer to 25%.

In premarket trading, the stock was down 2.39% at $60, according to Benzinga Pro data.

See Also: Best Energy Stocks

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