America's Silicon Valley Bank and signature banks suddenly went out of business, triggering panic among depositors, and Bank of America deposits continued to flow out. Just two weeks after Silicon Valley Bank announced its bankruptcy, there was an outflow of deposits of about 300 billion US dollars.

According to the latest report data released by the Federal Reserve on March 31, the week ending March 22,Within a week, the deposit size of all commercial banks in the US fell again by 125.7 billion US dollars, equivalent to about 865.8 billion yuanThis is the ninth week in a row of outflows.

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Bank of America deposit continues to flow out

The exodus of savers from small banks has clearly slowed down, and pressure has come on from the big banks. In the week ending March 22, deposits of small US banks rose slightly from 5.381 trillion US dollars last week to 5.386 trillion US dollars. Meanwhile, the deposits of the 25 largest banks by asset size fell from 10.74 trillion US dollars to 10.65 trillion US dollars, a total decrease of nearly 90 billion US dollars.

A number of European and American bank crises in March triggered turmoil in global financial markets, but unexpectedly brought about a frenzy in technology stocks.

The Hang Seng Technology Index rose 9.65% in March, leading the world. The A-share Science and Technology Innovation Board 50 Index surged 9.19% in March, exceeding Gold's 8.18% increase in March. Furthermore, the Nasdaq index rose 6.69% in March. Hang Seng Technology ETF, China Securities Internet ETF, and Nasdaq Index ETF rose 7% in March.

After the Bank of Silicon Valley went out of business, investors waited for Buffett to save Wall Street.

Earlier, someone revealed on Twitter the private jet route located in Omaha, the headquarters of Buffett's Berkshire Company, and tweeted: More than 20 private jets landed in Omaha yesterday afternoon. These planes took off from regional bank headquarters, ski resorts (Switzerland), and Washington. The private jets arrived in Omaha in groups of multiple groups, sometimes at almost the same time.

On March 19, Bloomberg quoted people familiar with the matter as reporting that Berkshire founder Warren Buffett has been in touch with senior officials in US President Joe Biden's administration in recent days.

Unexpectedly, stocks made frequent moves in March, not to bail out banks, but to continuously increase Western Oil's holdings.

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Add oil stocks,Is it right for Buffett to “gamble” again?‍

Buffett spent more than 1 billion US dollars to increase Western Oil's holdings three times in March of this year. The latest shareholding ratio of Occidental Petroleum was 23.6%, and the market value of the holdings was about 13.2 billion US dollars. In addition to Occidental Petroleum's common stock, Berkshire Hathaway also holds nearly 84 million Westpac warrants and preferred shares worth $10 billion, with a dividend rate of 8%.

Occidental Petroleum is one of the largest producers in the Permian Basin, the largest oil field in the United States, and is also one of the lowest-cost producers.

Since 2021, Occidental Petroleum's stock price has risen by more than 276%. Is it right for Buffett to “gamble” again?

Regarding this investment to buy Occidental Petroleum, in 2022, Buffett said that he only decided to buy shares in Occidental Petroleum because he read the records of the fourth-quarter earnings call from Occidental Petroleum.

In the earnings call for the fourth quarter of 2021, in addition to highlighting the strong performance of Occidental Petroleum, the CEO of Occidental Petroleum mainly emphasized the policy of continuously improving the balance sheet and the new shareholder return framework. At the same time, Buffett's third largest stock is also an oil company, Chevron, which holds 8.51% of Chevron's shares with a market value of 26.5 billion US dollars.

The last time Buffett swept oil stocks on a large scale was 20 years ago, which is one of his classic examples of investing in Hong Kong stocks.

In April 2003, Buffett bought CNPC 7 times in a row in the Hong Kong stock market, eventually holding 2.34 billion shares, making him the second largest shareholder of CNPC. In July 2007, Buffett reduced his holdings of CNPC H shares in batches at a price of about 12 Hong Kong dollars. In October of the same year, all of his holdings were cleared, making a profit of 4 billion US dollars.This investment was profitable 8 times over 4 years.

As for the reason for the purchase, after thoroughly studying CNPC's annual report, Buffett felt that CNPC's stock price had been seriously undervalued from 2002 to 2003. At the time of purchase, CNPC's profit reached more than 12 billion US dollars, with a market capitalization of 37 billion US dollars, and a price-earnings ratio of 3 times. At the same time, CNPC has always insisted on paying dividends at 45% of net profit, twice a year.

To resume investing in CNPC, Buffett emphasized that the three main factors to consider when buying CNPC were: 1. Valuation and price; 2. Profit growth; and 3. Cash yield.

Regarding the sale, Buffett explained that he thought the reasonable value of CNPC was in the range of 275 billion US dollars to 300 billion US dollars, and the market value of CNPC at the time was within that range.

Judging from the trend of oil prices at the time, international oil prices were only 30 US dollars in 2003 and reached a record high of 147.27 US dollars in 2008. The rise in oil prices was compounded by valuation repairs. CNPC received a double blow from Davis, and Buffett earned eight times.

After a lapse of 20 years, he bought Occidental Petroleum this time. At the Berkshire shareholders' meeting, Buffett was asked about his heavy holdings of oil stocks. Buffett said, “Currently, the US government has a storage capacity of over 1 billion dollars. Although people may now think that it is a good thing that this country has so many oil reserves, if you think carefully, it's still not enough — these reserves may be gone in three to five years, and you don't know what will happen in three to five years.”

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Announced by many countries! Global oil prices have skyrocketed due to voluntary production cuts

Over the weekend, Saudi Arabia joined several major oil producers to announce voluntary production cuts outside of the OPEC+ agreement. Saudi Energy Ministry officials emphasized that production cuts are aimed at supporting preventive measures in the oil market and are aimed at supporting the stability of the oil market.

Saudi Arabia, the largest crude oil exporter, will implement a plan to voluntarily cut production by 500,000 b/d starting in May until the end of 2023. Russian Deputy Prime Minister Novak, the second-largest crude oil exporter, said that Russia will voluntarily cut oil production by 500,000 b/d until the end of 2023. Iraq's Ministry of Petroleum, the fourth largest crude oil, said that Iraq decided to voluntarily cut oil production by 210,000 b/d starting in May and continuing until the end of 2023.

The oil minister of the UAE, the sixth largest crude oil exporter, said that oil production will be voluntarily reduced by 144,000 b/d from May to the end of 2023. Kuwait, the seventh-largest crude oil exporter, will voluntarily cut oil production by 128,000 b/d starting in May until the end of 2023. The Ministry of Energy of Kazakhstan, the ninth largest exporter of crude oil, said that Kazakhstan will contribute 78,000 b/d to OPEC+ production cuts.

Algeria will cut 48,000 b/d of oil production from May to the end of 2023.Oman's Ministry of Energy and Mines said it will voluntarily reduce oil production by 40,000 b/d starting in May until the end of 2023.

The world's nine major crude oil exporters, with the exception of the US, Canada, and Iran, all others participated in voluntary production cuts.

This voluntary production cut was carried out on the basis of the production reduction agreement reached at the 33rd OPEC and Non-OPEC Ministerial Meeting held on October 5, 2022. At the beginning of March, OPEC Secretary General Al Ghais said that OPEC is currently working to keep crude oil prices stable and avoid excessive market fluctuations.

OPEC cut production to support the oil market by tightening from the supply side. OPEC previously lowered its 2023 global crude oil demand forecast. In its monthly oil report, it was pointed out that due to poor seasonal demand, the global oil market may experience a slight oversupply in the next quarter, and lower the 2023 global crude oil demand forecast by 200,000 barrels per day.

Amrita Sen, head of research at EnergyAspects, said: “OPEC+ pre-emptively cut production to prevent the banking crisis from leading to weak demand.”

The White House's latest response to this production cut said, “Currently, cutting production is not advisable. The US is focusing on solving the price problem of American consumers.”

International oil prices rose across the board on Monday, with US oil surging nearly 7% and returning to 80 US dollars/barrel. A-share energy ETFs have risen, up 9% since this year.

(The content of this article is objective data(The list of information does not constitute any investment advice)

Betting heavily on Western oil, is the Omaha prophet right again this time?