With US-Iran tensions triggering one of the sharpest oil rallies in months, only for prices to reverse dramatically today, Warren Buffett’s long-held philosophy on geopolitical uncertainty is facing a real-time examination. So far, his playbook is holding up.
Buffett has argued for decades that during periods of war or major geopolitical risk, the worst move an investor can make is to retreat to cash. In a widely referenced 2014 CNBC interview that has been recirculated heavily in recent days, he stated:
“If we went into some very major war, the value of money would go down… The last thing you’d want to do is hold money during a war… You’re going to be a lot better off owning productive assets… than pieces of paper.”
His logic remains straightforward: conflicts disrupt markets in the short term, but businesses that produce real goods and services, especially in energy and essential commodities, continue generating value over time. Governments can print money, but they cannot instantly create new productive assets or replace disrupted oil supply.
The clearest recent demonstration of this philosophy in action is Berkshire Hathaway’s acquisition of OxyChem. The $9.7 billion deal for Occidental Petroleum’s industrial chemicals business closed on January 2, 2026, when commodity prices were still near multi-year lows. WTI crude had hit a 12-month low around $55 in December 2025, just weeks earlier. Buffett’s team locked in a high-quality industrial asset at a depressed valuation, classic Oracle of Omaha timing.
The geopolitical backdrop has since shifted sharply. The Strait of Hormuz returned to the spotlight, sending WTI crude as high as $119 per barrel in recent sessions before today’s sharp relief reversal. WTI is now trading in the $85–88 range (down 8–11% intraday) after de-escalation signals from Washington. Brent has followed a similar volatile path.
How Berkshire Hathaway and Occidental Are Performing Today
Berkshire Hathaway (NYSE: BRK-B) shares have remained remarkably steady through the turbulence, essentially flat year-to-date. Over the past five years, BRK-B has delivered strong compounded returns of roughly 90%, reflecting the power of owning a diversified base of productive assets.
Occidental Petroleum (NYSE: OXY) has been a more direct beneficiary of the energy rebound. The stock is up over 30% year-to-date and continues trading at 52-week highs, even after today’s oil pullback. The OxyChem divestiture delivered a major balance sheet win: Occidental used proceeds to cut principal debt by approximately $5.8 billion, bringing total debt down toward the $15 billion target.
CEO Vicki Hollub highlighted the improved flexibility in February, noting the company’s focus on “resilient free cash flow and maintaining flexibility in our capital and development programs.” OXY also raised its quarterly dividend more than 8% to $0.26 per share, with today (March 10) marking the record date and payment scheduled for April 15. The dividend has roughly doubled over the past four years, another clear signal of management’s confidence.
Berkshire Hathaway now holds approximately 29% of Occidental Petroleum following additional purchases in 2025–2026. While day traders chase headlines and oil swings wildly, Buffett’s expanding energy position (both the equity stake and full ownership of OxyChem) looks increasingly well-timed amid the Strait of Hormuz tension.
Buffett’s long-held framework holds that geopolitical noise is temporary, while productive assets that generate energy, chemicals, and essential returns continue operating through cycles. In today’s volatile environment, both Berkshire’s ownership in OXY and Occidental’s own capital allocation moves (debt reduction and dividend growth) appear to reflect exactly that mindset.
The lesson today is the same one Buffett has delivered for generations: own the productive assets, ignore the noise, and stay the course.