Page 9 - NorthAmOil Week 10 2022

NorthAmOil INVESTMENT NorthAmOil

Icahn disposes of Occidental stake, while

Berkshire Hathaway boosts ownership

US ACTIVIST investor Carl Icahn has sold off the 2.5% to around 10% in 2020 after its share price
remainder of his stake in Occidental Petroleum plummeted following the onset of the corona-
– which once amounted to 10% of the company virus (COVID-19) pandemic. He began selling
but had been whittled down recently. Icahn sold his shares in late February and early March this
what was left of the stake in recent days, accord- year, with the bulk of the sales priced at $41-49
ing to a letter sent to Occidental’s board on per share, the Financial Times reported citing
March 6 that was cited by the Wall Street Journal. securities filings. This enabled him to earn $1bn
The move appears to be designed to capital- in profit.
ise on stronger oil and gas prices, which have Occidental’s share price had risen close to $58
risen to multi-year highs amid Russia’s invasion per share as of March 10.
Carl Icahn previously of Ukraine. It also brings an end to Icahn’s con- Meanwhile, Warren Buffet’s Berkshire Hatha-
clashed with Occidental flict with Occidental over the company’s $38bn way disclosed that it had amassed a more than
over its acquisition of acquisition of Anadarko Petroleum – a transac- $5bn stake in Occidental, accounting for 91.2mn
Anadarko. tion of which he had been a vocal critic. He had shares, or nearly 10% of those outstanding.
campaigned to have Occidental’s CEO, Vicki According to a filing with the US Securities and
Hollub, ousted, with the company avoiding that Exchange Commission (SEC), 61.4mn of those
outcome by striking a deal to give Icahn’s repre- shares were acquired between March 2 and
sentatives two seats on its board in 2020. Those March 4.
two representatives are now resigning, Icahn said Reuters reported that Berkshire Hathaway
in his letter to Occidental’s board. also has warrants to buy another 83.9mn Occi-
Icahn increased his stake in Occidental from dental shares at $59.62 each, or for $5bn in total.™

PERFORMANCE

EIA makes major upward

revision to oil price outlook

GLOBAL THE US Energy Information Administration The previous STEO projected that Brent
(EIA) has made a major upward revision to its prices would fall back to $68.48 per barrel in
oil price forecast in its latest Short-Term Energy 2023, while WTI would drop to $64.48 per bar-
Outlook (STEO). The move comes amid the eco- rel. The latest forecast still has prices dropping
nomic fallout from Russia’s invasion of Ukraine, year on year for both benchmarks, but antici-
as the war continues for a second week. pates that they will stay at a higher level in 2023
The latest outlook was published on March – an average of $88.98 per barrel for Brent and
8, the same day that US President Joe Biden $84.98 per barrel for WTI.
announced that he would ban imports of Russian The EIA cautioned, however, that its price
oil. As other countries either follow suit or make forecast was “highly uncertain”.
plans to restrict Russian oil and gas imports, this Other changes to the forecast compared with
looks set to contribute to other factors that have last month are far less dramatic. The agency
been driving crude prices higher. now projects that global oil and liquids demand
Factoring in recent developments, the EIA will rise from 97.48mn barrels per day in 2021
now anticipates that spot Brent prices will to 100.61mn bpd in 2022 and 102.55mn bpd in
average $105.22 per barrel in 2022, up from 2023. Meanwhile, production is forecast to rise
a forecast of $82.87 per barrel in the previous from 95.55mn bpd in 2021 to 101.00mn bpd in
STEO, which was released in February. For 2022 and 102.97mn bpd in 2023. This means
West Texas Intermediate (WTI), the agency output would narrowly outpace demand over
has raised its 2022 forecast from $79.35 per this year and next – but given the current volatil-
barrel in the February outlook to $101.17 per ity, unplanned supply outages could easily cause
barrel in the latest one. an oil shortage.™

Week 10 10•March•2022 www. NEWSBASE .com P9