Should Warren Buffett dump Darfur-involved PetroChina?

I'm just about as big of a Warren Buffett fan as you'll find, but I found myself somewhat disillusioned when he declined to divest Berkshire Hathaway's (NYSE: BRK.A) stake in PetroChina (NYSE: PTR), after critics proposed such a move because of the company's ties to Darfur. Fidelity Investments recently sold its share of PetroChina for just that reason.

Buffett defended the investment by saying that it was Chinese state oil company CNPC, the parent of PetroChina that was involved with Darfur. But in a piece on TheStreet.com, Brett Arends points out just how closely the companies are linked. He discusses the numerous insiders at PetroChina who also work for or did work for CNPC; PetroChina's Chairman, Chen Geng, was General Manager at CNPC until last November.

Over at the Motley Fool, Emil Lee opined that Buffett should go ahead and sell the shares: "Both sides of the divestment argument are entitled to their own opinions, but I think that Berkshire should divest, not because it will help save Darfur victims -- the problems go much, much deeper than who owns PetroChina's shares -- but more because Berkshire has always been a beacon of light for investors everywhere, and it would be a tragedy for that light to be clouded, regardless of whether the reasoning was even slightly correct."

Lee summed it up perfectly. Berkshire's investment in PetroChina just smells bad, even if the company really isn't to blame. The arguments for divestiture were powerful enough to sway Fidelity, and I just really wish Berkshire would go ahead and sell the shares, if only to preserve its squeaky clean image.