Marathon Petroleum surges 3.7% as union ratifies landmark 4-year labor deal
15% wage increase and $2,500 bonus for 30,000 workers removes uncertainty across refining sector
Marathon Petroleum Corporation shares jumped 3.7% to $203 on Friday, surpassing their previous 52-week high, after the United Steelworkers union ratified a four-year national agreement negotiated by the refining giant that covers 30,000 oil industry workers across 26 refineries and chemical plants.
The landmark contract, which includes a 15% total wage increase and a $2,500 signing bonus, removes a significant overhang for the refining sector that had faced potential labor disruptions as negotiations intensified earlier this year. Workers will receive 4% wage increases in the first and fourth years of the agreement, with 3.5% raises in years two and three.
According to reports by OPIS via MarketWatch, the agreement establishes a pattern for industry-wide contracts and was formally adopted by the union on February 6, 2026. Marathon served as the lead negotiator for 26 companies in the national oil bargaining talks.
The resolution of labor tensions comes as a relief for investors in the refining sector, where profit margins have faced pressure from fluctuating crude oil prices and regulatory uncertainty. Earlier this week, workers at BP's Whiting refinery had authorized a strike as national contract talks continued, highlighting the risk that the negotiations could have escalated into broader industry action.
"This agreement provides stability for our workforce and predictability for our operations," the company stated in materials describing the deal. The four-year term extends through 2030, giving Marathon and other refiners certainty on their labor costs as they navigate the energy transition.
Marathon Petroleum, based in Findlay, Ohio, operates as one of the nation's largest independent petroleum refiners with a market capitalization of $58.9 billion. The company reported trailing twelve-month revenue of $133.4 billion and earnings per share of $13.22, trading at a forward price-to-earnings ratio of 12.2.
The union's approval of the contract covers a significant portion of the US refining workforce, effectively resolving what had become a central concern for investors tracking the sector. The 15% cumulative wage increase represents a middle ground between worker demands for inflation protection and company efforts to maintain competitiveness.
Analysts have been monitoring the labor negotiations closely, as the refining industry faces unique challenges including environmental regulations and the long-term shift toward renewable energy. The removal of labor uncertainty could help support refining margins and allow companies to focus on operational efficiency and strategic capital allocation.
Marathon's shares are now trading above analyst consensus targets of $196.56, with 10 analysts rating the stock a buy or strong buy and nine recommending hold. The stock's 70% beta suggests lower volatility relative to the broader market, while institutional ownership stands at 77%, reflecting strong institutional confidence in the company's position.
The labor agreement comes at a critical time for the refining industry, which has seen consolidation and capacity rationalization in recent years. By securing a four-year pact, Marathon and other refiners gain stability to plan investments and operational improvements without the threat of work stoppages.
Looking ahead, investors will focus on Marathon's ability to maintain refining margins in what remains a cyclical industry. The company's next dividend is scheduled for March 10, 2026, with an ex-dividend date of February 18, providing additional catalysts for shareholder attention in the coming weeks.