Chevron's Credibility Threatened as Exxon Competes Aggressively for Hess' Guyana Assets

Hess has recently hinted that this acquisition by Chevron could be delayed due to arbitration proceedings initiated by Exxon Mobil. These proceedings, which typically last 5-6 months, were launched by Exxon Mobil to protect its rights to a significant oil discovery off the coast of Guyana, a key asset in Chevron's plan to acquire Hess. If Exxon Mobil's challenge proves successful in blocking the merger, it would mark the second time Chevron CEO Mike Wirth has missed out on a major deal, following Occidental Petroleum's thwarting of Chevron's $33 billion offer for Anadarko in 2019.

If Chevron backs out of the deal with Hess, Hess may be freed from a $1.7 billion breakup fee. Experts are uncertain about the outcome of the deal.

There is a possibility that Exxon Mobil might make a bid for Hess before the Chevron-Hess shareholder vote, or Chevron could be compelled to pay Exxon Mobil to allow the deal to proceed. In the energy market, crude oil prices have dropped this week, with Nymex crude for April delivery closing at its lowest level since February 26. Brent crude has also seen a decrease, while natural gas prices have slightly declined as well.

The energy and natural resources industry, as reflected by the Energy Select Sector SPDR ETF, ended the week with a slight increase. Companies like Nuscale Power, Navios Maritime Partners, and MGE Energy saw gains in the past five days, while Brenmiller Energy, Albemarle, and Amplify Energy experienced declines.