National Oil Bargaining Program Update: What Marathon Negotiations with the United Steelworkers Mean for U.S. Refining Operations

The National Oil Bargaining Program (NOBP) is once again shaping the future of the U.S. refining and petrochemical industry as negotiations between the United Steelworkers (USW) and 26 major employers, such as Marathon Petroleum, ExxonMobil, Chevron, Valero Energy, BP, Phillips 66, and Shell move through a critical phase. With labor agreements covering roughly two-thirds of U.S. refining capacity, the outcome of these talks carries significant implications for refinery operations, workforce stability, and supply chain continuity nationwide.

The Role of the National Oil Bargaining Program

The National Oil Bargaining Program was formed in 1965 when union workers unified to counterbalance the growing power of major oil companies. At its core, the program established a common contract expiration date and an industry-wide oil policy that applies across employers. This framework created consistent labor standards regardless of company ownership and became the foundation of the Steelworkers’ bargaining power.

Today, the program represents more than 30,000 USW members across refining, oil and gas production, pipelines, maintenance, storage, and petrochemical operations. With workers across dozens of employers in more than 200 bargaining units, they collectively account for approximately two-thirds of all U.S. refining capacity. Through national bargaining, the Steelworkers negotiate wages as well as healthcare cost sharing, job security protections, training standards, health and safety requirements, and benefit protections in the event of mergers or acquisitions.  Source: usw.org

Marathon Petroleum Leads Bargaining 

Marathon serves as the lead negotiator for 26 U.S. refiners and chemical companies. Because Marathon is the largest U.S. refiner and operates roughly 16 percent of national refining capacity, the agreement reached with the Steelworkers will establish the national pattern contract that other employers are expected to follow. 

As a result, negotiations with Marathon will have a significant impact. The terms agreed to at the national level will cascade across the industry, shaping labor costs, workforce policies, and operational standards for years to come.

Current Status of National Oil Bargaining Talks

According to Reuters, the Steelworkers and Marathon have agreed to rolling 24-hour extensions of the current labor contract, temporarily averting a strike while negotiations continue. Since talks began, the union has rejected multiple proposals from Marathon. The most recent offer includes a 15 percent wage increase spread over four years, structured as a four percent increase in the first year, 3.5 percent increases in the second and third years, and a final four percent increase in the fourth year.

The proposal also includes a $2,500 signing bonus, with most other contract terms remaining consistent with previous agreements. Inside refinery operators currently earn about $50 per hour after completing their probationary period. While the offer represents movement on wages, the Steelworkers have neither accepted nor rejected it. The National Oil Bargaining Program policy committee plans to meet with union members nationwide before determining next steps.

Issues Beyond Wages

Although wages are a central focus of the National Oil Bargaining Program, several non-economic issues remain unresolved. Cost-of-living adjustments are a major concern for Steelworkers, particularly after years of inflation and volatility in energy markets. Healthcare cost sharing is another sticking point, as the union seeks to limit increases in employee out-of-pocket expenses.

Another topic in the current negotiations is the use of artificial intelligence and automation in refinery operations. The Steelworkers are pushing for clear national standards governing how AI is implemented, how it affects jobs, and how safety oversight is maintained. Safety standards themselves remain an area of contention, with the union advocating for stronger, more consistent protections across facilities.

What This Means for Refinery and Chemical Plants

Despite the contract extensions, the risk of labor disruption has not been eliminated. The Steelworkers retain the ability to issue a 24-hour strike notice, and Marathon can issue a lockout notice with the same timeframe. Any disruption would have immediate implications for fuel production, chemical output, logistics, and downstream supply chains.

Because USW-represented facilities account for nearly two-thirds of U.S. refining capacity, even limited labor action could ripple across the broader economy. Labor uncertainty also complicates maintenance planning, turnaround scheduling, and production forecasting for refinery operators already managing tight margins and regulatory pressures.

Preparing for a Work Stoppage

For employers, preparing strike contingency plans is standard before entering into contract negotiations with their unions to ensure business continuity in the event of a work stoppage, prevent severe revenue loss, and strengthen their bargaining position. 

Although MADICORP no longer provides strike related services, it does have nearly 30 years of experience developing strike contingency plans and providing strike replacement workers and strike security across the United States. On the American Made podcast, Michele Vincent and Joel Zimmerman discuss strike planning best practices, how rolling contract extensions negatively impact strike readiness, common misconceptions about strike staffing and strike security, along with advice for employers currently in negotiations.

 

Looking Ahead

The outcome of the National Oil Bargaining Program negotiations between the Steelworkers and Marathon will set the tone for labor relations across the U.S. refining sector. The agreement ultimately reached will influence wages, workforce policies, safety standards, and operational flexibility across Marathon, Exxon Mobil, Chevron, Valero, Shell, BP, and the broader industry.

As talks progress, refinery leaders should continue monitoring developments closely, assessing operational risk, and ensuring contingency strategies align with the realities of a constrained skilled labor market.

 

 

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