Berkshire Hathaway 2026 Annual Meeting: Part 3 5/3/26

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**Becky Quick** (1:01)
Hi, everyone, this is CNBC's Becky Quick in Omaha, Nebraska, and you are listening to part three of our full coverage of the 2026 Berkshire Hathaway Annual Shareholder Meeting. We pick up here with the second session of Questions and Answers hosted by Berkshire's new CEO, Greg Abel. With him on stage was Katie Farmer, CEO of the BNSF Railroad, and Adam Johnson, CEO of NetJets and new president of Berkshire's Consumer Products, Service, and Retailing Businesses.

**Greg Abel** (1:31)
Welcome back. I hope you enjoyed the break. Becky, Warren, thank you for that exceptional interview. Appreciate that.
Well, we're very fortunate to have Katie and Adam in these leadership roles. Again, it was a very purposeful to have them on stage. We want them to have the opportunity to engage with our owners, our shareholders, and we really do look forward to the questions. So thank you for joining us on stage again. Thank you. Becky, again, great to have you back. Thank you for that interview, and if you'd like to start, thank you.

**Becky Quick** (2:17)
Okay, thanks, Greg. This question comes from Chris Freed in Philadelphia, Pennsylvania, who wants to know, how has the current geopolitical situation in the Middle East impacted Berkshire's subsidiaries?

**Greg Abel** (2:32)
Sure. I'll touch on it, and then I'll make sure, because it impacts, really, in a variety of ways, all our businesses. But what I'm most proud of are our businesses. We operate these businesses for the long run, just like we do for, obviously, for our shareholders. We take a long-term approach. There's not many days, and I used to joke when I more had Adam's role, there wasn't a day I woke up where the phone wasn't ringing with good news.
That phone rang. I knew you're going to have a bit of a challenge, and we have that portfolio, but that's okay. We'd be talking, and we always worked our way through it. And we have a team that would lean in, and we'd come through, and it could be anything. And we never tried to use that as a reason. We couldn't do something or get to the right place. And what I've seen associated with the, obviously, the war in Iran and the various conflicts in the Middle East, is, again, a team is very much taking the approach that that's the situation we're in. We can manage our business, and we very much quickly move to, what's the best solution for our customers? How can we deliver and continue to deliver what we've done to them, and what's their expectations around that? And our teams will work incredibly hard to come up with solutions.
I touched on LSBI, the drag reduction agent on the pipeline company.
They don't usually sell a lot of product into the Middle East as far as moving. It's more a domestic-based product for Canon in the US. When you think of a drag reduction agent on pipelines, literally being cargo planes of that chemical being moved in the Middle East to help free up supply, and I removed some of that constraint. So there's so many things that go on when they start trying to figure out how to solve the challenge. Now, what I would say is it doesn't mean there's not immediate impacts to our businesses. If you think of companies in America or around the globe, petroleum is in natural gas matter is such a fundamental input to so many products. And the reality is if you think I touched on our chemical group, their input is generally a petroleum product. And the output is the various products they produce, obviously, that are byproducts of that. But their input costs have effectively doubled in a very short period of time.
But again, we'll manage to do that. And that's the beauty of being part of Berkshire. They know first we'll take care of our customer, we'll find the right answer, we'll manage the challenges, and the value creation will be there in the end. So there's some short-term pressure on our chemical businesses. If you looked at their first quarter profits individually, they would be down because they're, or flat to down, because they've got some challenges, for example, on the input side. But they're delivering what the customer needs, and that rebalances over a period of time, where our prices will move up, pursuant to our contracts. We'll be treated fairly in the end, in that they'll reset and then man-wind a little bit slower. But the point is, unfortunately, the situation, and we've got men of service and women of service over there and putting themselves at risk.