So far, 2016 has been a tough ride for the markets. In just the first two weeks of trading, the Dow Jones Industrial Average has fallen 4.8%, and the S&P 500 has fallen 8%. For stocks, this has been the worst start to a year on record.
But crude oil has been hit even harder. So far this year, the price of oil has dropped by more than 20%, to less than $30 per barrel. It was the worst two-week decline since the financial crisis of 2008. And crude oil hasn't been this cheap in 12 years. It's looking like black mold instead of black gold.
Warren Buffett's Berkshire Hathaway (BRK.A) (BRK.B) is quickly adding to its holdings of one oil company, Phillips 66 (PSX) . So do the Oracle of Omaha's purchases indicate oil has reached -- or is close to reaching -- a bottom?
The answer: not quite.
Phillips 66, headquartered in Houston, was spun off from energy behemoth ConocoPhillips (COP) in 2012. Buffett, who already held shares of the parent company, was handed Phillips 66 stock at that time. He quickly added to his position, grabbing 27.2 million shares shortly after the spinoff. In 2014, Buffett bailed on ConocoPhillips, selling his remaining shares, along with a huge portion of Berkshire's Exxon Mobil holdings.
Not only did Buffett stay invested in Phillips 66, but he has added to his position over time. In September he purchased more shares after revealing that Berkshire owned more than a $4.5 billion stake in the company in August.
But this week, Berkshire spent more than $450 million on the company, adding another 5.1 million shares to its portfolio, according to filings with the Securities and Exchange Commission. After seven straight days of trading, Buffett now owns 13% of outstanding Phillips 66 shares, valued at nearly $5.3 billion.