Marathon Petroleum Plummets 2.9% Amid Refinery Disruptions and Analyst Volatility

Summary
• Marathon Petroleum (MPC) trades at $189.85, down 2.89% from its previous close of $195.52
• Intraday range spans $189.09–$197.96, reflecting sharp volatility
• Analysts raised price targets to $177–$211, while refinery outages in Louisiana weigh on sentiment

Marathon Petroleum’s shares face a dramatic intraday selloff as refinery shutdowns and conflicting analyst signals collide. The stock’s 2.9% decline underscores a tug-of-war between bullish technical indicators and near-term operational risks, with options activity surging as traders hedge for volatility.

Galveston Bay Refinery Outages and Analyst Divergence Fuel Turbulence
The selloff stems from ongoing disruptions at Marathon’s Galveston Bay refinery, which remains partially offline after a mid-September fire and chemical leak. While the company expects operational improvements by year-end, the facility’s downtime has compressed refining margins, particularly in the Gulf Coast and West Coast regions. Compounding the issue, analysts like JPMorgan’s Zach Parham raised 2026 EPS estimates to $14.82 but maintained a neutral rating, citing mixed Q3 results. Meanwhile, short-term put options (e.g., MPC20251219P190) surged in volume, reflecting bearish positioning ahead of the December 19 expiration.

Energy Sector Rally Masks Refining Sector Weakness
While the broader energy sector has rallied on elevated refining margins—driven by European and Asian outages—Marathon underperforms its peers. Exxon Mobil (XOM), the sector’s leader, trades flat (-0.09%) despite similar macro tailwinds. This divergence highlights Marathon’s vulnerability to regional refining bottlenecks, particularly in the Gulf Coast, where its throughput remains below capacity. The S&P 500 Energy Index’s 1.5% gain contrasts with Marathon’s 2.9% drop, signaling a near-term disconnect between sector strength and company-specific risks.

Options and Technicals: Navigating Volatility in a Polarized Market
• MACD: 2.39 (above signal line 2.27), suggesting bullish momentum
• RSI: 49.9 (neutral), indicating balanced buying/selling pressure
• Bollinger Bands: Price at $189.85 (near lower band $186.93), hinting at oversold conditions
• 200D MA: $165.29 (well below current price), signaling long-term strength

Key levels to watch: The 30D support at $195.90 and 200D support at $178.92. Short-term bearish momentum aligns with the RSI’s neutral stance, but the MACD’s positive divergence suggests a potential rebound. For options, two contracts stand out:

• MPC20251219P190 (Put)
- Strike: $190, Expiry: 12/19
- IV: 30.93% (moderate), Leverage: 30.77%, Delta: -0.456, Theta: -0.053, Gamma: 0.0234
- IV (Implied Volatility): Reflects market uncertainty
- Leverage: Amplifies downside potential
- Delta: Sensitive to price swings
- Theta: Low decay suits short-term hedging
- Gamma: High sensitivity to price movement
- This put offers asymmetric upside if the stock breaks below $190, with a 5% downside scenario yielding a $10.15 payoff (max profit at $189.85 → $10.15).

• MPC20251219C190 (Call)
- Strike: $190, Expiry: 12/19
- IV: 33.40% (moderate), Leverage: 24.49%, Delta: 0.541, Theta: -0.168, Gamma: 0.0217
- IV: Reflects market uncertainty
- Leverage: Amplifies upside potential
- Delta: Strong directional bias
- Theta: High decay suits aggressive bullish bets
- Gamma: Moderate sensitivity to price movement
- This call is ideal for a rebound above $190, with a 5% upside scenario yielding a $4.85 payoff (max profit at $199.85 → $4.85).

Action: Aggressive bulls may consider MPC20251219C190 into a bounce above $190, while cautious bears should eye MPC20251219P190 for downside protection.

Backtest Marathon Petroleum Stock Performance
The event study was completed successfully. You can review the interactive back-test results in the embedded module.Key findings (30-day horizon summary):• Total events analysed: 6 • Average cumulative return after 20 trading days: +9.4% vs S&P 500 +2.5% • From day 22 onward, event-driven returns become statistically significant and remain so through day 30, peaking near +18 %. • Short-term (1-5 day) performance is mixed with no statistical significance; the edge materialises only after ~3 weeks.Interpretation:Marathon Petroleum (MPC) has historically tended to rebound strongly in the weeks following a single-day drop of −3 % or worse. While immediate reactions are uncertain, patience of roughly one month has, on average, delivered meaningful outperformance versus the benchmark. This suggests that sharp sell-offs in MPC may offer attractive swing-trade or tactical accumulation opportunities, provided investors can tolerate interim volatility.Feel free to explore the chart for detailed event paths, distribution of returns, and individual event drill-downs or let me know if you’d like to test alternative thresholds, holding windows, or add risk controls.

Critical Crossroads: Watch $190 Breakdown or Refinery Recovery
Marathon’s near-term trajectory hinges on two factors: the pace of Galveston Bay’s restart and the durability of refining margins. The stock’s 2.9% drop has brought it closer to its 200D MA ($165.29), a critical long-term support level. However, the sector’s resilience—exemplified by Exxon Mobil’s flat performance—suggests refining fundamentals remain intact. Investors should monitor the 12/19 options expiry for liquidity-driven moves and the 2025 Q4 earnings report (Nov 4) for operational updates. For now, a breakdown below $190 would validate bearish sentiment, while a rebound above $197.96 could reignite bullish momentum. Act: Position for volatility with the MPC20251219P190 put or MPC20251219C190 call, and watch for a catalyst from the refinery or sector dynamics.