Subject: Re: Rising diesel prices -BNSF
“OXY stock up from $41 to $58 this year, though that's probably not very important to the folks in Omaha.”

Wondering what you mean here?

What do you think was the Buffett and Munger thesis with the Oxy investments?

Debt reduction; lower exploration risk; engineering capability; low breakeven costs at $40 oil; domestic security creating demand; carbon capture. Or maybe just the 8% preferred plus calls at $59.63. Plus the 10% early redemption fee. Last point seems to fit well enough with Berkshire’s 9% hurdle.

Or was there an attraction to the really long term inflation hedge of owning oil in a world with increasing inflationary policies?

I suppose the buying of the equity below $60 per share suggests he is happy to own longer term now the debt is melting.

Is he likely thinking about the valuation and FCF or is he more interested in a hedge, or both?