Marathon Petroleum Corporation (MPC) shares are trading lower in the premarket on Wednesday, following news of a strike at the company’s Detroit refinery. Half of the refinery’s workforce has walked out due to ongoing disputes regarding pay and safety concerns.
The union representing the workers has been engaged in negotiations with Marathon for the past nine months, advocating for improved wages and more favorable work schedules. The Detroit refinery processes both sweet and heavy sour crude oils into gasoline and distillates, boasting a daily refining capacity of 140,000 barrels.
Despite the strike, Marathon has assured investors that they are fully prepared to maintain safe operations at the facility and have implemented plans to ensure uninterrupted production.
It’s important to note that this news comes on the heels of a strong second-quarter earnings report from Marathon Petroleum. The company exceeded revenue estimates and delivered an adjusted EPS that surpassed the consensus. The company’s refining costs also saw a drop to $4.97 per barrel, while crude oil capacity utilization increased to 97% from 93% year-over-year.
Marathon Petroleum has projected refining operating costs of $5.35 per barrel and refinery throughputs of 2,845 mbpd for the third quarter. Investors seeking exposure to the energy sector can consider ETFs like the iShares U.S. Oil & Gas Exploration & Production ETF (IEO) and the VanEck Oil Refiners ETF (CRAK).
