Marathon Oil (MRO) Stock Slides, Oil Hits Three-Month Low

Oil prices retreated today, weighing on Marathon Oil (MRO) stock.
By Rachel Aldrich ,

NEW YORK (TheStreet) -- Shares of Marathon Oil (MRO) - Get Report  closed down 3.76% to $13.58 today after oil futures declined on speculation of a global oversupply.

Crude oil (WTI) fell 2.58% to $43.05 per barrel and Brent crude declined 2.23% to $44.67.

"Given the oversupply in the refined product markets, fading refinery margins and economic run cuts, we expect crude oil demand to deteriorate further over the coming months," Morgan Stanley said in a note cited by MarketWatch.

The firm said that crude demand is falling well short of supply, and that it could decline to one-third the level of last year for the third quarter. Disruptions in production including militant attacks on oil infrastructure in Nigeria appear to be coming to an end as well, allowing for unimpeded production growth.

The Baker Hughes (BHI) rig count reported the biggest weekly gain so far in 2016 last week, U.S. drillers adding 14 rigs to total 371 for the week.

Analysts are also waiting for an update from the Federal Reserve on interest rates in the coming months. Economic data including an upbeat June jobs report indicates that the Fed will hike interest rates in the coming months, potentially as early as September.

Marathon Oil is a Houston-based exploration and production company.

Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.

TheStreet Ratings rated this stock as a "sell" with a ratings score of D.

The company's weaknesses can be seen in multiple areas, such as its poor profit margins, weak operating cash flow, generally disappointing historical performance in the stock itself, disappointing return on equity and feeble growth in its earnings per share.

You can view the full analysis from the report here: MRO

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