This Is Why Crude Oil Prices Are Driving MRO’s Stock Price



Marathon Oil’s Operating Revenue Mix

In 4Q16 Marathon Oil’s (MRO) operating revenue from crude oil (USO), natural gas (UNG), and natural gas liquids sales totaled ~$1.2 billion, a fall of ~16% compared to 4Q15.

The year-over-year (or YoY) rise in MRO’s 4Q16 oil and gas revenues was primarily due to its higher YoY realized prices. We’ll study MRO’s realized prices in next article.

As we can see in the chart above, in 4Q16, ~85%, or ~$979 million, of Marathon Oil’s operating revenue came from crude oil sales, ~9%, or ~$107 million, came from natural gas sales, and only ~6%, or ~$64 million, came from natural gas liquids sales.

The majority of Marathon Oil’s revenue came from crude oil sales, so crude oil prices were the key driving factor of the company’s stock price.

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Other upstream players

Other upstream companies such as Energen (EGN), EOG Resources (EOG), and Diamondback Energy (FANG) also have the majority of their operating revenues coming from crude oil sales.


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