Hess (HES) Inaugural Oil & Gas Conference summary

Conference overview

• The event featured a fireside chat with key executives, focusing on sector sentiment, upcoming OPEC decisions, and oil/gas trading ranges.

• Polls gauged market views on sector valuation, OPEC outcomes, and preferred subsectors, including services and midstream.

• The session was structured around the pending merger, macro outlook, and operational updates.

Merger and arbitration update

• The merger's completion hinges on arbitration over Guyana's right of first refusal, with a hearing set for May 2025 and a decision expected within three months.

• Management expressed high confidence in prevailing, citing clear contract terms under English law.

• Integration planning is well advanced, focusing on day-one readiness and cultural alignment.

• Restrictions exist on hedging and certain capital actions until the merger closes.

• If the merger fails, the company will continue its growth strategy, emphasizing its strong portfolio.

Macro and industry outlook

• Oil market fundamentals are balanced, but recent demand softness is attributed to China and U.S. economic factors.

• OPEC is expected to continue its stabilizing role, with Brent seen in the $70–$80 range and demand growth of 1 million barrels/day annually through 2030.

• Industry investment has normalized at $500 billion/year after years of underinvestment; continued investment is needed to offset depletion and meet demand.

• U.S. energy policy should prioritize natural gas for power, a balanced approach to vehicle propulsion, and accelerated SPR refilling.

• The Trump administration is expected to support oil and gas growth through regulatory reform and expanded access.