For the past few weeks Unocal has been trying to decide between a safe Chevron offer of $61 per share and a more controversial CNOOC bid of $67 per share. Chinese oil company CNOOC had hoped its higher offer would win the day.

However, a number of US regulatory hurdles have thus far hindered the Chinese firm’s takeover efforts, despite it tabling a higher bid than Chevron. Concerns over the implications of a Chinese firm buying a US oil company have been widely cited as a reason for Unocal’s reticence to accept the CNOOC bid.

Unocal’s dilemma appears to now be resolved as Chevron’s improved offer of $63 per share has put the US giant firmly in pole position to clinch the deal.

Analysts are predicting that CNOOC will have to top $70 per share to stay in the race. However, early indications suggest that an improved offer will not be forthcoming as the CNOOC board had previously authorized a maximum bid of only $69 per share.

CNOOC now has until the Unocal shareholders vote on the Chevron offer on August 10 to decide whether it wants to stay in the battle.