Marathon Petroleum Corp

Previous wording

This Quarterly Report on Form 10-Q, particularly Management’s Discussion and Analysis of Financial Condition and Results of Operations and Quantitative and Qualitative Disclosures about Market Risk, includes forward-looking statements that are subject to risks, contingencies or uncertainties. You can identify forward-looking statements by words such as “anticipate,” “believe,” “commitment,” “could,” “design,” “estimate,” “expect,” “forecast,” “goal,” “guidance,” “intend,” “may,” “objective,” “opportunity,” “outlook,” “plan,” “policy,” “position,” “potential,” “predict,” “priority,” “project,” “prospective,” “pursue,” “seek,” “should,” “strategy,” “target,” “will,” “would” or other similar expressions that convey the uncertainty of future events or outcomes.

Current wording

This Quarterly Report on Form 10-Q, particularly Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations and Item 3. Quantitative and Qualitative Disclosures about Market Risk, includes forward-looking statements that are subject to risks, contingencies or uncertainties. You can identify forward-looking statements by words such as “anticipate,” “believe,” “commitment,” “could,” “design,” “estimate,” “expect,” “focus,” “forecast,” “goal,” “guidance,” “intend,” “may,” “objective,” “opportunity,” “outlook,” “plan,” “policy,” “position,” “potential,” “predict,” “priority,” “project,” “prospective,” “pursue,” “seek,” “should,” “strategy,” “target,” “will,” “would” or other similar expressions that convey the uncertainty of future events or outcomes.

Previous wording

•environmental, social and governance (“ESG”) plans and goals, including those related to greenhouse gas emissions and intensity, freshwater withdraw intensity, diversity and inclusion and ESG reporting;

Current wording

•environmental, social and governance (“ESG”) plans and goals, including those related to greenhouse gas emissions and intensity, freshwater withdraw intensity, inclusion and ESG reporting;

Previous wording

•general economic, political or regulatory developments, including inflation, interest rates, changes in governmental policies relating to refined petroleum products, crude oil, natural gas, NGLs or renewables, or taxation;

Current wording

•general economic, political or regulatory developments, including tariffs, inflation, interest rates, changes in governmental policies relating to refined petroleum products, crude oil, natural gas, NGLs or renewable diesel and other renewable fuels, or taxation;

Previous wording

•the regional, national and worldwide availability and pricing of refined products, crude oil, natural gas, renewables, NGLs and other feedstocks;

Current wording

•the regional, national and worldwide availability and pricing of refined products, crude oil, natural gas, renewable diesel and other renewable fuels, NGLs and other feedstocks;

Previous wording

•the timing and extent of changes in commodity prices and demand for crude oil, refined products, feedstocks or other hydrocarbon-based products, or renewables;

Current wording

•the timing and extent of changes in commodity prices and demand for crude oil, refined products, feedstocks or other hydrocarbon-based products or renewable diesel and other renewable fuels;

Previous wording

•volatility in or degradation of general economic, market, industry or business conditions, including as a result of pandemics, other infectious disease outbreaks, natural hazards, extreme weather events, regional conflicts such as hostilities in the Middle East and in Ukraine, inflation, or rising interest rates;

Current wording

•volatility in or degradation of general economic, market, industry or business conditions, including as a result of pandemics, other infectious disease outbreaks, natural hazards, extreme weather events, regional conflicts such as hostilities in the Middle East and in Ukraine, tariffs, inflation, or rising interest rates;

Previous wording

•changes in producer customers’ drilling plans or in volumes of throughput of crude oil, natural gas, NGLs, refined products, other hydrocarbon-based products or renewables;

Current wording

•changes in producer customers’ drilling plans or in volumes of throughput of crude oil, natural gas, NGLs, refined products, other hydrocarbon-based products or renewable diesel and other renewable fuels;

Previous wording

•changes in the cost or availability of third-party vessels, pipelines, railcars and other means of transportation for crude oil, natural gas, NGLs, feedstocks, refined products and renewables;

Current wording

•changes in the cost or availability of third-party vessels, pipelines, railcars and other means of transportation for crude oil, natural gas, NGLs, feedstocks, refined products and renewable diesel and other renewable fuels;

Previous wording

•political and economic conditions in nations that consume refined products, natural gas, renewables and NGLs, including the United States and Mexico, and in crude oil producing regions, including the Middle East, Russia, Africa, Canada and South America;

Current wording

•political and economic conditions in nations that consume refined products, natural gas, renewable diesel and other renewable fuels and NGLs, including the United States and Mexico, and in crude oil producing regions, including the Middle East, Russia, Africa, Canada and South America;

Previous wording

•acts of war, terrorism or civil unrest that could impair our ability to produce refined products, receive feedstocks or to gather, process, fractionate or transport crude oil, natural gas, NGLs, refined products or renewables;

Current wording

•acts of war, terrorism or civil unrest that could impair our ability to produce refined products, receive feedstocks or to gather, process, fractionate or transport crude oil, natural gas, NGLs, refined products or renewable diesel and other renewable fuels;

Previous wording

•political pressure and influence of environmental groups and other stakeholders that are adverse to the production, gathering, refining, processing, fractionation, transportation and marketing of crude oil or other feedstocks, refined products, natural gas, NGLs, other hydrocarbon-based products or renewables;

Current wording

•political pressure and influence of environmental groups and other stakeholders that are adverse to the production, gathering, refining, processing, fractionation, transportation and marketing of crude oil or other feedstocks, refined products, natural gas, NGLs, other hydrocarbon-based products or renewable diesel and other renewable fuels;

Previous wording

•the inability or failure of our joint venture partners to fund their share of operations and development activities;

Current wording

•the inability or failure of our joint venture partners to fund their share of operations and capital investments;

Previous wording

•the imposition of windfall profit taxes, maximum margin penalties or minimum inventory requirements on companies operating in the energy industry in California or other jurisdictions.

Current wording

•the imposition of windfall profit taxes, maximum margin penalties, minimum inventory requirements or refinery maintenance and turnaround supply plans on companies operating in the energy industry in California or other jurisdictions.

Previous wording

Our third quarter results reflect a lower margin environment versus the third quarter of 2023. Margin volatility in the third quarter reflected steady demand for gasoline and diesel and growing demand for jet fuel while refining utilization remained high supported by a light turnaround season and limited seasonal supply interruptions. Longer term, demand growth is expected to exceed the net supply impact from limited capacity additions through the end of the decade and announced and expected refinery rationalizations. We anticipate these fundamentals, as well as the U.S. refining industry’s current structural advantages over the rest of the world, will support a constructive environment for U.S. refiners.

Current wording

Our first quarter results versus the first quarter of 2024 reflect a lower refining margin environment. Longer term, global demand growth is expected to outpace the net impact of capacity additions and rationalizations through the end of the decade. We anticipate these fundamentals, as well as the U.S. refining industry’s current structural advantages over the rest of the world, will support a constructive environment for U.S. refiners.

Previous wording

Gain on sale of assets in the first nine months of 2024 includes $151 million resulting from the Whistler Joint Venture Transaction. See Note 13 to the unaudited consolidated financial statements for additional information on this transaction.

Current wording

See Note 4 to the unaudited consolidated financial statements for additional information on this transaction.

Previous wording

Refer to the Results of Operations section for a discussion of consolidated financial results and Segment Results for the third quarter of 2024 as compared to the third quarter of 2023 and the first nine months of 2024 compared to the first nine months of 2023.

Current wording

Refer to the Results of Operations section for a discussion of consolidated financial results and Segment Results for the first quarter of 2025 as compared to the first quarter of 2024.

Previous wording

We owned approximately 647 million MPLX common units as of September 30, 2024, with a market value of $28.78 billion based on the September 30, 2024 closing price of $44.46 per common unit. On October 29, 2024, MPLX declared a quarterly cash distribution of $0.9565 per common unit payable on November 15, 2024, to unitholders of record on November 8, 2024. This represents a 12.5 percent increase over the prior quarter distribution. MPC’s portion of this distribution is approximately $619 million.

Current wording

We owned approximately 647 million MPLX common units as of March 31, 2025, with a market value of $34.65 billion based on the March 31, 2025 closing price of $53.52 per common unit. On April 29, 2025, MPLX declared a quarterly cash distribution of $0.9565 per common unit payable on May 16, 2025 to unitholders of record on May 9, 2025. MPC’s portion of this distribution is approximately $619 million.

Previous wording

We received limited partner distributions of $1.65 billion from MPLX in the nine months ended September 30, 2024 and $1.51 billion in the nine months ended September 30, 2023.

Current wording

We received limited partner distributions of $619 million from MPLX in the three months ended March 31, 2025 and $550 million in the three months ended March 31, 2024.

Previous wording

During the nine months ended September 30, 2024, MPLX repurchased approximately 6 million MPLX common units at an average cost per unit of $41.32 and paid $226 million of cash. As of September 30, 2024, approximately $620 million remained available under the authorization for future unit repurchases.

Current wording

During the three months ended March 31, 2025, MPLX repurchased approximately 2 million MPLX common units at an average cost per unit of $52.48 and paid $100 million of cash. As of March 31, 2025, approximately $420 million remained available under the authorization for future unit repurchases.

Previous wording

Refining & Marketing segment adjusted EBITDA depends largely on our refinery throughput, Refining & Marketing margin, refining operating costs and distribution costs.

Current wording

Refining & Marketing segment adjusted EBITDA depends largely on our refinery throughputs, Refining & Marketing margin, refining operating costs and distribution costs.

Previous wording

Our Midstream segment gathers, transports, stores and distributes crude oil, refined products, including renewable diesel, and other hydrocarbon-based products, principally for our Refining & Marketing segment. Additionally, the segment markets refined products. The profitability of our pipeline transportation operations primarily depends on tariff rates and the volumes shipped through the pipelines. The profitability of our marine operations primarily depends on the quantity and availability of our vessels and barges. The profitability of our terminal operations primarily depends on the throughput volumes at our terminals. The profitability of our fuels distribution services primarily depends on the sales volumes of certain refined products. The profitability of our refining logistics operations depends on the quantity and availability of our refining logistics assets. A majority of the crude oil and refined product shipments on our pipelines and marine vessels, the throughput at our terminals and refining logistics assets serve our Refining & Marketing segment and our fuels distribution services are used solely by our Refining & Marketing segment. As discussed above in the Refining & Marketing section, MPLX, which is reported in our Midstream segment, has various long-term, fee-based commercial agreements related to services provided to our Refining & Marketing segment. Under these agreements, MPLX has received various commitments of minimum throughput, storage and distribution volumes as well as commitments to pay for all available capacity of certain assets. The volume of crude oil that we transport is directly affected by the supply of, and refiner demand for, crude oil in the markets served directly by our crude oil pipelines, terminals and marine operations. Key factors in this supply and demand balance are the production levels of crude oil by producers in various regions or fields, the availability and cost of alternative modes of transportation, the volumes of crude oil processed at refineries and refinery and transportation system maintenance levels. The volume of refined products that we transport, store, distribute and market is directly affected by the production levels of, and user demand for, refined products in the markets served by our refined product pipelines and marine operations. In most of our markets, demand for gasoline and distillate peaks during the summer driving season, which extends from May through September of each year, and declines during the fall and winter months. As with crude oil, other transportation alternatives and system maintenance levels influence refined product movements.

Current wording

Our Midstream segment gathers, transports, stores and distributes crude oil, refined products, including renewable diesel, and other hydrocarbon-based products, principally for our Refining & Marketing segment. Additionally, the segment markets refined products. The profitability of our pipeline transportation operations primarily depends on tariff rates and the volumes shipped through the pipelines. The profitability of our marine operations primarily depends on the quantity and availability of our vessels and barges. The profitability of our light product terminal operations primarily depends on the throughput volumes at these terminals. The profitability of our fuels distribution services primarily depends on the sales volumes of certain refined products. The profitability of our refining logistics operations depends on the quantity and availability of our refining logistics assets. A majority of the crude oil and refined product shipments on our pipelines and marine vessels and the refined product throughput at our terminals serve our Refining & Marketing segment and our refining logistics assets and fuels distribution services are used solely by our Refining & Marketing segment. As discussed above in the Refining & Marketing section, MPLX, which is reported in our Midstream segment, has various long-term, fee-based commercial agreements related to services provided to our Refining & Marketing segment. Under these agreements, MPLX has received various commitments of minimum throughput, storage and distribution volumes as well as commitments to pay for all available capacity of certain assets. The volume of crude oil that we transport is directly affected by the supply of, and refiner demand for, crude oil in the markets served directly by our crude oil pipelines, terminals and marine operations. Key factors in this supply and demand balance are the production levels of crude oil by producers in various regions or fields, the availability and cost of alternative modes of transportation, the volumes of crude oil processed at refineries and refinery and transportation system maintenance levels. The volume of refined products that we transport, store, distribute and market is directly affected by the production levels of, and user demand for, refined products in the markets served by our refined product pipelines and marine operations. In most of our markets, demand for gasoline and distillate peaks during the summer driving season, which extends from May through September of each year, and declines during the fall and winter months. As with crude oil, other transportation alternatives and system maintenance levels influence refined product movements.

Previous wording

Our Midstream segment also gathers, processes and transports natural gas and transports, fractionates, stores and markets NGLs. NGL and natural gas prices are volatile and are impacted by changes in fundamental supply and demand, as well as market uncertainty, availability of NGL transportation and fractionation capacity and a variety of additional factors that are beyond our control. Our Midstream segment profitability is affected by prevailing commodity prices primarily as a result of processing at our own or third‑party processing plants, purchasing and selling or gathering and transporting volumes of natural gas at index‑related prices and the cost of third‑party transportation and fractionation services. To the extent that commodity prices influence the level of natural gas drilling by our producer customers, such prices also affect profitability.

Current wording

Our Midstream segment also gathers, processes and transports natural gas and transports, fractionates, stores and markets NGLs. NGL and natural gas prices are volatile and are impacted by changes in fundamental supply and demand, as well as market uncertainty, availability of NGL transportation and fractionation capacity and a variety of additional factors that are beyond our control. Our Midstream segment profitability is affected by prevailing commodity prices primarily as a result of processing or conditioning at our own or third‑party processing plants, purchasing and selling or gathering and transporting volumes of natural gas at index‑related prices and the cost of third‑party transportation and fractionation services. To the extent that commodity prices influence the level of natural gas drilling by our producer customers, such prices also affect profitability.

Previous wording

•decreased sales and other operating revenues of $6.40 billion primarily due to decreased Refining & Marketing segment average refined product sales prices of $0.22 per gallon, partially offset by increased refined product sales volumes of 58 mbpd;

Current wording

•decreased sales and other operating revenues of $1.19 billion primarily due to decreased Refining & Marketing segment average refined product sales prices of $0.22 per gallon, partially offset by increased refined product sales volumes of 204 mbpd; and

Previous wording

•decreased other income of $292 million mainly due to lower income on RIN sales and the absence of insurance proceeds received in the third quarter of 2023.

Current wording

•decreased other income of $178 million mainly due to the absence of insurance proceeds received in the first quarter of 2024.

Previous wording

•decreased cost of revenues of $302 million primarily due to decreased crude oil costs and finished product purchases, partially offset by higher contract services and material and supply expenses related to increased turnaround activity; and

Current wording

Costs and expenses decreased $264 million primarily due to decreased cost of revenues of $233 million primarily due to decreased finished product purchases and lower contract services and material and supply expenses related to decreased turnaround activity, partially offset by increased purchases from our Martinez Renewables joint venture and increased energy costs.

Previous wording

Net interest and other financial costs increased $103 million largely due to decreased interest income, primarily on lower short-term investments, and increases in interest expense, mainly due to higher MPLX borrowings, currency exchange losses and non-service pension costs.

Current wording

Net interest and other financial costs increased $125 million largely due to decreased interest income and discount amortization, primarily due to the absence of short-term investments held in 2024.

Previous wording

We recorded a combined federal, state and foreign income tax provision of $113 million for the three months ended September 30, 2024, which was lower than the U.S. statutory rate primarily due to permanent tax benefits related to net income attributable to noncontrolling interests offset by state taxes. We recorded a combined federal, state and foreign income tax provision of $1.0 billion for the three months ended September 30, 2023, which was higher than the U.S. statutory rate primarily due to state taxes offset by permanent tax benefits related to net income attributable to noncontrolling interests and foreign derived intangible income.

Current wording

We recorded a combined federal, state and foreign income tax provision of $37 million for the three months ended March 31, 2025, which was lower than the U.S. statutory rate primarily due to permanent tax benefits related to net income attributable to noncontrolling interests and discrete state tax benefits. We recorded a combined federal, state and foreign income tax provision of $293 million for the three months ended March 31, 2024, which was lower than the U.S. statutory rate primarily due to permanent tax benefits related to net income attributable to noncontrolling interests partially offset by state taxes.

Previous wording

Net income attributable to noncontrolling interests increased $61 million primarily due to an increase in MPLX’s net income in the third quarter of 2024. See further discussion in the Midstream Segment Results section.

Current wording

Net income attributable to noncontrolling interests increased $55 million primarily due to an increase in MPLX’s net income in the first quarter of 2025. See further discussion in the Midstream Segment Results section.

Previous wording

We classify our business in the following reportable segments: Refining & Marketing and Midstream. Segment adjusted EBITDA represents adjusted EBITDA attributable to the reportable segments. Amounts included in income before income taxes and excluded from segment adjusted EBITDA include: (i) depreciation and amortization; (ii) net interest and other financial costs; (iii) turnaround expenses; and (iv) other adjustments as deemed necessary. These items are either: (i) believed to be non-recurring in nature; (ii) not believed to be allocable or controlled by the segment or (iii) are not tied to the operational performance of the segment.

Current wording

We classify our business in the following reportable segments: Refining & Marketing, Midstream and Renewable Diesel. Segment adjusted EBITDA represents adjusted EBITDA attributable to the reportable segments. Amounts included in income before income taxes and excluded from segment adjusted EBITDA include: (i) depreciation and amortization; (ii) net interest and other financial costs; (iii) turnaround expenses; and (iv) other adjustments as deemed necessary. These items are either: (i) believed to be non-recurring in nature; (ii) not believed to be allocable or controlled by the segment or (iii) are not tied to the operational performance of the segment.

Previous wording

Refining & Marketing segment revenues decreased $6.51 billion primarily due to decreased average refined product sales prices of $0.22 per gallon, partially offset by increased refined product sales volumes of 58 mbpd.

Current wording

Refining & Marketing segment revenues decreased $1.52 billion primarily due to decreased average refined product sales prices of $0.22 per gallon, partially offset by increased refined product sales volumes of 204 mbpd.

Previous wording

Net refinery throughput increased 32 mbpd during the third quarter of 2024.

Current wording

Net refinery throughput increased 193 mbpd during the first quarter of 2025 largely due to decreased turnaround activity during the quarter.

Previous wording

Refining & Marketing segment adjusted EBITDA decreased $3.32 billion primarily due to decreases in per barrel margins. Refining & Marketing segment adjusted EBITDA was $3.82 per barrel for the third quarter of 2024, versus $16.06 per barrel for the third quarter of 2023.

Current wording

Refining & Marketing segment adjusted EBITDA decreased $1.50 billion primarily due to decreases in per barrel margins. Refining & Marketing segment adjusted EBITDA was $1.91 per barrel for the first quarter of 2025, versus $8.22 per barrel for the first quarter of 2024.

Previous wording

Refining & Marketing margin was $14.35 per barrel for the third quarter of 2024 compared to $26.16 per barrel for the third quarter of 2023. Refining & Marketing margin is affected by our performance against the market indicators shown earlier, which use spot market values and an estimated mix of crude purchases and product sales. Based on the market indicators and our crude oil throughput, we estimate a net negative impact of approximately $4 billion on Refining & Marketing margin for the third quarter of 2024 compared to the third quarter of 2023, primarily due to lower crack spreads. Our reported Refining & Marketing margin differs from market indicators due to the mix of crudes purchased and their costs, the effect of market structure on our crude oil acquisition prices, the effect of RIN prices on the crack spread, and other items like refinery yields, other feedstock variances and fuel margin from sales to direct dealers. These factors had an estimated net positive effect of approximately $300 million on Refining & Marketing segment adjusted EBITDA in the third quarter of 2024 compared to the third quarter of 2023.

Current wording

Refining & Marketing margin was $13.38 per barrel for the first quarter of 2025 compared to $19.35 per barrel for the first quarter of 2024. Refining & Marketing margin is affected by our performance against the market indicators shown earlier, which use spot market values and an estimated mix of crude purchases and product sales. Based on the market indicators and our crude oil throughput, we estimate a net negative impact of approximately $1.7 billion on Refining & Marketing margin for the first quarter of 2025 compared to the first quarter of 2024, primarily due to lower crack spreads. Our reported Refining & Marketing margin differs from market indicators due to the mix of crudes purchased and their costs, the effect of market structure on our crude oil acquisition prices, the effect of RIN prices on the crack spread, and other items like refinery yields, other feedstock variances and fuel margin from sales to direct dealers. These factors had an estimated net positive effect of approximately $500 million on Refining & Marketing segment adjusted EBITDA in the first quarter of 2025 compared to the first quarter of 2024.

Previous wording

For the three months ended September 30, 2024, refining operating costs, excluding depreciation and amortization, increased $56 million, or $0.16 per barrel, primarily due to higher maintenance costs and expenses for projects conducted during turnaround activity.

Current wording

For the three months ended March 31, 2025, refining operating costs, excluding depreciation and amortization, increased $7 million primarily due to higher energy costs, partially offset by decreased maintenance costs and expenses for projects conducted during turnaround activity. Refining operating costs, excluding depreciation and amortization, decreased $0.32 per barrel due to higher throughput.

Previous wording

Distribution costs, excluding depreciation and amortization, include fees paid to MPLX of $1.0 billion and $975 million for the third quarter of 2024 and 2023, respectively.

Current wording

Distribution costs, excluding depreciation and amortization, increased $63 million and include fees paid to MPLX of $990 million and $967 million for the first quarter of 2025 and 2024, respectively. Distribution costs, excluding depreciation and amortization, decreased $0.08 per barrel due to higher throughput.

Previous wording

Other income decreased $84 million, or $0.30 per barrel, largely due to the absence of insurance proceeds received in the third quarter of 2023.

Current wording

Other income decreased $180 million, or $0.74 per barrel, largely due to the absence of insurance proceeds received in the first quarter of 2024.

Previous wording

Refining planned turnaround costs increased $0.49 per barrel, or $137 million, due to the scope and timing of turnaround activity.

Current wording

Refining planned turnaround costs decreased $0.91 per barrel, or $193 million, due to the scope and timing of turnaround activity.

Previous wording

We purchase RINs to satisfy a portion of our RFS2 compliance. Our expenses associated with purchased RINs were $253 million and $561 million in the third quarter of 2024 and 2023, respectively. The RINs expense is included in Refining & Marketing margin. The decrease in the third quarter of 2024 was primarily due to decreased RIN sales and average RINs prices in addition to increased RINs generated and acquired from our Martinez Renewables joint venture, partially offset by an increased RIN obligation.

Current wording

We purchase RINs to satisfy a portion of our RFS2 compliance. Our expenses associated with purchased RINs were $354 million and $301 million in the first quarter of 2025 and 2024, respectively. The RINs expense is included in Refining & Marketing margin. The increase in the first quarter of 2025 was primarily due to increased obligated volumes, partially offset by higher RINs generated and acquired from our Martinez Renewables joint venture and lower sale activity.

Previous wording

(c)Represents fully loaded export cargoes for each time period. These sales volumes are included in the total sales volume amounts.

Current wording

(b)Represents fully loaded refined product export cargoes for each time period. These sales volumes are included in the total sales volume amounts.

Previous wording

(a)C2 + NGL pricing based on Mont Belvieu prices assuming an NGL barrel of approximately 35 percent ethane, 35 percent propane, 6 percent iso-butane, 12 percent normal butane and 12 percent natural gasoline.

Current wording

(a)C2 + NGL pricing based on Mont Belvieu prices assuming an NGL barrel of approximately 10 percent ethane, 60 percent propane, five percent Iso-Butane, 15 percent normal butane and 10 percent natural gasoline.