NEW YORK (
) -- Strategic financing was the major mover of energy shares on Thursday morning, with shares of
(MRO - Get Report)
and Spanish energy giant
opening higher by 8% to 9%.
Marathon Oil announced plans to spin-off its refining business from its exploration and production operations.
Refining is a low margin business and this isn't the first time that Marathon Oil has tried to take the business public as a separate entity. It considered a spinoff two years ago. Marathon Oil said on Thursday that business conditions make now the right time to split the business in two.
The refining company, to be called Marathon Petroleum, will be the fifth-largest refiner in the U.S.
Marathon Oil will focus on exploration and production, oil sands mining and integrated Gas.
spiked after reports in the Spanish business press alleged that India's Essar Energy was about to buy a 5% stake in the company, a stake valued at close to $1.7 billion.
Repsol officially denied the reports, saying there were no talks with Essar.
has been a big player in the past year in snatching up stakes in energy companies. U.S. oil and gas companies in joint venture agreements with Reliance include
Pioneer Natural Resources
Carrizo Oil & Gas
Reliance had also been rumored last year to be in a deal with
, but that joint venture ended up going to the other emerging market player with a major appetite for global energy assets, China and its state-run
Repsol and Marathon Oil both hit 52-week highs on Thursday morning. Many stocks in the energy sector have been trading at 52-week highs in recent weeks as the price of crude oil has moved higher, peaking in Wednesday's action above the $92 per barrel mark.
Strength in the price of crude and a bullish global outlook on energy demand are reasons Marathon thinks a spinoff is better timed now than when it had been originally considered two years ago.
The energy sector opened lower on Thursday, with Marathon Oil and Repsol bucking the trading trend.
-- Written by Eric Rosenbaum from New York.
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