Hess paid $325M for more exposure to soaring crude oil prices, CEO says (NYSE:HES)
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Hess (NYSE:HES) last week paid ~$325M to remove hedges of $100/bbl for WTI crude and $105/bbl for Brent crude “in light of recent high volatility and liquidity risk in the oil markets,” CEO John Hess told the Scotia Howard Weil Energy conference on Tuesday, according to Bloomberg.
The $325M is nearly double the original cost of the hedges last October, as the cost to trade in options has surged amid spiking crude prices after Russia’s invasion of Ukraine.
Hess still has protection if oil prices drop below $60-$65/bbl, and dissolving the call options it had allows the company to realize gains from a further rally in prices.
Hess shares surged on Monday to an intraday high of $103.94, their highest level since summer 2014.
