Marathon Oil (MRO)

Foreign Currency Exchange Rate Risk

We manage our exposure to foreign currency exchange rates by utilizing forward and option contracts, although we had no option contracts open at December 31, 2008. The primary objective of this program is to reduce our exposure to movements in foreign currency exchange rates by locking in such rates. The following table summarizes our derivative foreign currency derivative instruments as of December 31, 2008.

The aggregate cash flow effect on foreign currency contracts of a hypothetical 10 percent change to exchange rates at December 31, 2008, would be $52 million.

Foreign Currency Exchange Rate Risk

We manage our exposure to foreign currency exchange rates by utilizing forward and option contracts, although we had no option contracts open at December 31, 2008. The primary objective of this program is to reduce our exposure to movements in foreign currency exchange rates by locking in such rates. The following table summarizes our derivative foreign currency derivative instruments as of December 31, 2008.

The aggregate cash flow effect on foreign currency contracts of a hypothetical 10 percent change to exchange rates at December 31, 2008, would be $52 million.

Foreign Currency Exchange Rate Risk

FACE="Times New Roman" SIZE="2">We manage our exposure to foreign currency exchange rates by utilizing forward and option contracts, although we had no option contracts open at December 31, 2008. The primary objective of this program is to
reduce our exposure to movements in foreign currency exchange rates by locking in such rates. The following table summarizes our derivative foreign currency derivative instruments as of December 31, 2008.

Foreign Currency Exchange Rate Risk

We manage our exposure to foreign currency exchange rates by utilizing forward and option contracts. The primary objective of this program is to reduce our exposure to movements in foreign currency exchange rates by locking in such rates. The following table summarizes our derivative foreign currency instruments as of December 31, 2007.

The aggregate cash flow effect on foreign currency forward contracts of a hypothetical 10 percent change to exchange rates at December 31, 2007, would be approximately $11 million.

During 2007, we entered into derivative foreign currency instruments with a notional amount of $3.5 billion to limit our exposure to changes in the Canadian dollar exchange rate related to the cash portion of the purchase for Western. These derivative instruments were settled on October 17, 2007, and a pretax gain of $182 million was recognized.

Foreign
Currency Exchange Rate Risk

We manage our exposure to foreign currency exchange rates by utilizing forward and option contracts.
The primary objective of this program is to reduce our exposure to movements in foreign currency exchange rates by locking in such rates. The following table summarizes our derivative foreign currency instruments as of December 31, 2007.

Foreign Currency Exchange Rate Risk

We manage our exposure to foreign currency exchange rates by utilizing forward and option contracts.  The primary objective of this program is to reduce our exposure to movements in the foreign currency markets by locking in foreign currency rates.  The aggregate effect on foreign currency contracts of a hypothetical 10 percent change to exchange rates at June 30, 2007, would be approximately $6 million.  There have been no significant changes to our exposure to foreign exchange rates subsequent to December 31, 2006.

Foreign Currency Exchange Rate Risk

We manage our exposure to foreign currency exchange rates by utilizing forward and option contracts.  The primary objective of this program is to reduce our exposure to movements in the foreign currency markets by locking in foreign currency rates.  The aggregate effect on foreign currency contracts of a hypothetical 10 percent change to exchange rates at March 31, 2007, would be approximately $11 million.  There have been no significant changes to our exposure to foreign exchange rates subsequent to December 31, 2006.

Foreign Currency Exchange Rate Risk

        We manage our exposure to foreign currency exchange rates by utilizing forward and option contracts. The primary objective of this program is to reduce our exposure to movements in the foreign currency markets by locking in foreign currency rates. At December 31, 2006, the following currency derivatives were outstanding. All contracts currently qualify for hedge accounting.

^(a)

Rates shown are weighted average all-in forward rates for the period.

^(b)

Fair value was based on market rates.

^(c)

U.S. dollar to foreign currency.

^(d)

Foreign currency to U.S. dollar.

        The aggregate effect on foreign currency forward contracts of a hypothetical 10 percent change to exchange rates at December 31, 2006, would be approximately $14 million.

Foreign Currency Exchange Rate Risk

        We manage our exposure to foreign currency exchange rates by utilizing forward contracts, generally with terms of 365 days or less. The primary objective of this program is to reduce our exposure to movements in the foreign currency markets by locking in foreign currency rates. At December 31, 2004, the following commodity derivatives were outstanding. All contracts currently qualify for hedge accounting unless noted.

^(a)

The rate at which the derivative instruments will be settled.

^(b)

On December 31, 2004, $18 million was discontinued and no longer qualified for hedge accounting. On January 31, 2005, this amount was re-qualified for hedge accounting.

^(c)

U.S. dollar to foreign currency.

^(d)

Foreign currency to U.S. dollar.

        The aggregate effect on foreign exchange contracts of a hypothetical 10 percent change to year-end exchange rates would be approximately $15 million.