Warren Buffett kept a lot of cash on hand in recent years.

At the end of 2021, the cash pile at his holding company Berkshire Hathaway had grown to a near-record $146.7 billion. That shouldn’t come as a surprise. Buffett is a value investor, after all, and valuations were bloated in the U.S. stock market after significant rallies in 2020 and 2021.

“We find little that excites us,” Buffett said in a recent Berkshire shareholder letter. But in 2022, Berkshire has spent around $7.5 billion acquiring shares of integrated oil and gas giant Occidental Petroleum (OXY).

Berkshire’s total stake in OXY is 143 million shares, worth approximately $10 billion.

Let’s take a closer look at the move and figure out if investors should follow suit.

Big bet on big oil

Berkshire backed up the truck on OXY after the company’s earnings conference call held in late February. Buffett read the transcript and liked what he saw.

“I read every word, and said this is exactly what I would be doing. She’s running the company the right way,” the billionaire investor told CNBC, referring to Occidental CEO Vicki Hollub. “We started buying on Monday and we bought all we could.”

In Q4 of 2021, Occidental generated $8.01 billion of revenue, representing a 139% increase year over year. Adjusted earnings per share came in at $1.48, a marked improvement over the adjusted loss of 65 cents per share in the year-ago period.

In the conference call, Hollub highlighted Occidental’s strong operational results, improved balance sheet and a new shareholder-return framework.

On Feb. 24, the company’s board of directors declared a regular quarterly dividend of 13 cents per share on OXY common shares, a whopping 1,200% increase over the prior quarter’s payout of just 1 cent per share. The company also announced a $3 billion share repurchase program.

Three months later, we learned that things continued to improve in 2022. In Q1, OXY generated $8.53 billion of revenue and adjusted earnings of $2.12 per share.