Can Marathon Oil Corporation Overcome Hurricane-Related Headwinds to Continue Its High Growth Ways in Q3?
After slowing down during the oil market downturn, Marathon Oil (NYSE: MRO) hit the gas this year and restarted production growth. The company was able to reverse its production decline during the second quarter and initially expected that output from its U.S. shale plays would increase 15% to 20% by the end of the year. However, thanks to excellent drilling results during the first half of the year, the company boosted its full-year production outlook last quarter, with it now anticipating 23% to 27% growth by year end.
That said, Marathon went up against an unanticipated headwind during the third quarter in the form of Hurricane Harvey, which drenched southern Texas. The storm forced several companies operating in the Eagle Ford Shale to shut in producing wells and shut down drilling rigs, causing a decline in output from the region. That would seem to be bad news for Marathon Oil since it's a major Eagle Ford Shale producer. However, according to a press release from the company, the storm didn't have much of an effect on its production, which suggests it should report solid third-quarter results this Wednesday evening. Because of that, it doesn't seem like the storm will force the company to water down its full-year growth forecast or future expectations.
Image source: Getty Images.
Source: Fool.com
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