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Why Warren Buffett Isn’t Buying Into Phillips at the Top

Maybe Warren Buffett will start calling it Phillips 132.

Oil prices were near their all-time peak back in 2008, when Mr. Buffett first bought into ConocoPhillips, COP 4.98 % then an integrated oil and gas company. He later admitted to “terrible timing” with that investment and used it as currency in a shares-for-assets swap with wholly owned Berkshire unit Lubrizol.

To the untrained eye, Mr. Buffett’s new commitment to Phillips 66—a 2012 spinoff from ConocoPhillips, owning its downstream units—might look like another instance of buying at the top. After all, a confluence of factors such as wide spreads between U.S. crude and refined-products prices on global markets have made the past...