Marathon Oil’s stock jumps toward 3 1/2-year high as oil prices extend surge, and after credit rating upgrade

Shares of Marathon Oil Corp.
MRO,
+4.02%
powered up 2.4% in afternoon trading Friday toward a 3 1/2-year high, as the oil and gas exploration and production company benefited from the spike up in oil prices to a 14-year high, and as the company’s credit rating was put in position to be lifted out of “junk” territory. Continuous crude oil futures shot up 7.3% to $115.51, the highest price seen since September 2008 as Russia’s war on Ukraine intensified. Separately, Moody’s Investors Service raised Marathon Oil’s Corporate Family Rating to Ba1, which is one notch below investment grade, from Ba2. The outlook for the rating remains “positive,” which makes the next rating move most likely to be another upgrade if the company remains focused on debt reduction. “Occidental Petroleum generated increasingly higher earnings in 2021 as oil and gas prices rose, and significantly reduced its leverage by applying free cash flow and asset sale proceeds towards debt reduction,” said Moody’s analyst James Wilkins. Marathon’s stock, which is on track for the highest close since Oct. 3, 2018, has soared 53.3% over the past three months, while the SPDR Energy Select Sector ETF
XLE,
+2.89%
has rallied 35.5% and the S&P 500
SPX,
-0.79%
has shed 5.0%.