ConocoPhillips has contracted from $90 earlier this year to under $50 and is now currently yielding around 4%. COP should earn close to $12/share in 2008 for a current P/E of 4 (that is not a typo). When was the last time a quality company like COP traded with its yield equal to its P/E? I have disagreed with some of Buffett's consumer related picks in the past, but this choice was excellent (and not just because I own it).
The world's governments are doing their best to reflate the planet's economy. They will either be successful, in which oil will come back strong, or, will all fall into the economic abyss and I'm not sure at that point it matters what investments you have other than perhaps cows, goats, a catfish pond, a garden, and a couple hunting rifles.
Besides COP's strong U.S. presence, its positions in natural gas, its stake in LukOil (OTC:LUKOF), and its many ongoing international projects bold well for the future. In addition, Jim Mulva is simply one of the best CEO's in the oil patch. He is known in the international oil community as a problem solver, an easy guy to work with, and has a reputation for not being as arrogant as most U.S. oil company CEOs are.
I hope Buffett is in COP for the long term, as I am. Railroads and oil companies - stick to em Warren. I just wish you and Charlie would come out strong and lend your names, influence, and perhaps even your money to support a strategic, long-term, comprehensive energy policy like this:
That would be the single best investment you could make in the U.S., and perhaps the best insurance policy you could take out on the companies that Berkshire owns. If the U.S. doesn't fix its energy crisis, all stocks will do badly, including BRK.A.
Disclosure: The author owns COP.