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The consolidation also comes as the major energy players are flush with cash following the run-up in crude prices in the aftermath of the Russian invasion of Ukraine in February 2022.
Oil prices have been on a wild ride ever since. They spiked more than 40 percent after the unprovoked attack, then moderated toward the end of 2022. But they have been trending upward more recently, spurred first by Saudi Arabian supply cutbacks and then by fears of a broader Middle East war amid the violence in Israel.
West Texas Intermediate crude, the U.S. benchmark stood around $87 per barrel as of Monday morning, up 11 percent over the past six months. Brent crude stood close to $91 per barrel.
Through Hess, Chevron acquires a large stake in Guyana’s Starbroek block, which it heralded as the world’s largest oil discovery in the last 10 years.
“I believe our strategic combination creates a company that is stronger in every respect, with the leadership, asset portfolio and financial resources to lead us through the energy transition and deliver significant shareholder value for years to come,” John Hess, CEO of the acquired company, said in a statement.
This is developing story and will be updated.
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