John Hess, chief executive officer of Hess Corp., speaks at the 2024 CERAWeek by S&P Global conference in Houston, Texas, US, on Tuesday, March 19, 2024.
F. Carter Smith | Bloomberg | Getty Images
The Federal Trade Commission has banned Hess Corp. CEO John Hess from Chevron‘s board as a condition for the oil companies’ $53 billion merger to move forward.
The FTC on Monday alleged that Hess encouraged OPEC representatives to draw down inventories, which would result in higher oil prices.
“Mr. Hess’s communications with competitors about global oil output and other dimensions of crude oil market competition disqualify him from serving on Chevron’s Board of Directors,” Henry Liu, director of the FTC’s Bureau of Competition, said in a statement Monday.
Hess said the FTC concerns are without merit, describing the CEO’s communications with OPEC as consistent with statements he has made to the U.S. government.
Hess Corp. and Chevron, however, have agreed that they will not appoint Hess to the board in order to facilitate the completion of the merger, according to the companies. Hess will serve as an advisor to Chevron on government relations and “social investments” in Guyana.
The FTC’s decision to allow the deal leaves the companies’ dispute with Exxon Mobil as the final hurdle for the transaction to close. Exxon has filed claims with an arbitration panel claiming a right of first refusal over Hess’ lucrative oil assets in Guyana.
If the arbitration panel rules in Exxon’s favor, the Chevron-Hess deal will not close. Chevron and Hess have said they are confident that panel will rule in their favor.
This is a developing story. Please check back for updates.
