Hess Corp (HES.US) and Chevron Corp (CVX.US) recently announced that the arbitration hearing related to the acquisition plan with ExxonMobil (XOM.US) will be postponed until at least May 2025. After the announcement, the shares of both giants plummeted on Thursday with the former falling by 7.9%, marking the lowest closing price in six months, while the latter fell by 4.9%, marking the largest single-day decline since October 2023.

Hess and Chevron previously issued guidance, expecting to make a decision in the fourth quarter of 2024. The price difference between Hess's trading price and Chevron's acquisition offer has reached nearly $15, the largest since the announcement of the acquisition last October, indicating growing market concerns about the outcome of the deal.

ExxonMobil argued that Chevron's bid for Hess triggered the clause regarding the right of first refusal in their joint operating agreement in Guyana. This clause means that if one party wants to sell its shares, it must first offer them to other participating parties in the project. Chevron and Hess objected to this statement.

Bilaji Borkhataria, an analyst at RBC Capital, wrote that Chevron's performance this year has lagged behind that of ExxonMobil by more than 10%, and "recent setbacks may continue to weigh on investment for a longer time."

Although investors' initial focus was on the premium for acquiring Hess and the lack of synergies, Borkhataria believes that investors have accepted the deal, "so if the issues persist or the deal ultimately fails, we could see further downside to Chevron's stock."