Chevron just confirmed what most investors had already accepted as the most probable outcome when a company rep said it would not be raising its offer for Anadarko.

By walking away from the deal, Chevron will collect a $1 billion cash breakup fee from the shale driller. As a consolation for its shareholders, Chevron will increase its buyback program by 25%.

Chevron's CEO Michael Wirth said during an interview with CNBC on the day Chevron announced its bid that the company wouldn't raise its $33 billion cash-and-stock offer for Anadarko.

The oil giant's shares surged nearly 4% in premarket trade on the news, while shares of Occidental and Anadarko slipped.

The news is a huge victory for Occidental CEO Vicki Hollub, who topped Chevron's offer for Anadarko and successfully enlisted Berkshire Hathaway to finance the deal. Judging by the movements of Occidental's corporate jet, which has recently traveled to France and the Netherlands, the company is trying to find a buyer for some of Anadarko's foreign assets like a natural gas project in Mozambique.