<PAGE> 1

                                    FORM 10-Q

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C.  20549

(Mark One)

      [X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
           EXCHANGE ACT OF 1934
                                        
                  For the Quarterly Period Ended March 31, 2001
                                        
                                       or
                                        
      [ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
           EXCHANGE ACT OF 1934

           For the transition period from ------------ to ------------
                                        
                                        
                                 USX CORPORATION
------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


           Delaware             1-5153            25-0996816
       ---------------       ------------    -------------------
       (State or other       (Commission        (IRS Employer
       jurisdiction of       File Number)    Identification No.)
        incorporation)

600 Grant Street, Pittsburgh, PA                  15219-4776
---------------------------------------           ----------
(Address of principal executive offices)          (Zip Code)

                                 (412) 433-1121
                         ------------------------------
                         (Registrant's telephone number,
                              including area code)


--------------------------------------------------------------------------------

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.  Yes..X..No.....

Common stock outstanding at April 30, 2001:

               USX-Marathon Group       -  308,607,455  shares
               USX-U. S. Steel Group    -   88,800,321  shares


<PAGE> 2

                                 USX CORPORATION
                                  SEC FORM 10-Q
                          QUARTER ENDED March 31, 2001
                          ----------------------------

                                     INDEX                        Page
                                     -----                        ----

PART I - FINANCIAL INFORMATION

     A.   Consolidated Corporation


       Item 1. Financial Statements:

               Consolidated Statement of Operations                  4

               Consolidated Balance Sheet                            6

               Consolidated Statement of Cash Flows                  8

               Selected Notes to Consolidated
                Financial Statements                                 9

               Ratio of Earnings to Combined Fixed Charges
                and Preferred Stock Dividends and Ratio of
                Earnings to Fixed Charges                           20


       Item 2. Management's Discussion and Analysis of
                Financial Condition and Results of
                Operations                                          21


       Item 3. Quantitative and Qualitative Disclosures about
               Market Risk                                          30

               Financial Statistics                                 32

     B.   Marathon Group


       Item 1. Financial Statements:

               Marathon Group Statement of Operations               33

               Marathon Group Balance Sheet                         34

               Marathon Group Statement of Cash Flows               35

               Selected Notes to Financial Statements               36


       Item 2. Marathon Group Management's Discussion and
                Analysis of Financial Condition and
                Results of Operations                               43


       Item 3. Quantitative and Qualitative Disclosures about
                Market Risk                                         53

               Supplemental Statistics                              55

<PAGE> 3

                                 USX CORPORATION
                                  SEC FORM 10-Q
                          QUARTER ENDED March 31, 2001
                          ----------------------------

                                     INDEX                        Page
                                     -----                        ----

PART I - FINANCIAL INFORMATION (Continued)

     C.   U. S. Steel Group


       Item 1. Financial Statements:

               U. S. Steel Group Statement of Operations            57

               U. S. Steel Group Balance Sheet                      58

               U. S. Steel Group Statement of Cash Flows            59

               Selected Notes to Financial Statements               60


       Item 2. U. S. Steel Group Management's Discussion
                and Analysis of Financial Condition
                and Results of Operations                           66


       Item 3. Quantitative and Qualitative Disclosures about
                Market Risk                                         74

               Supplemental Statistics                              76


PART II - OTHER INFORMATION



       Item 1. Legal Proceedings                                    77

       Item 5. Other Information                                    78

       Item 6. Exhibits and Reports on Form 8-K                     79


<PAGE> 4


Part I - Financial Information

     A.   Consolidated Corporation

<TABLE>
                    USX CORPORATION AND SUBSIDIARY COMPANIES
                CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)
                ------------------------------------------------
<CAPTION>                                      
                                                  First Quarter Ended
                                                        March 31
(Dollars in millions)                                2001      2000
---------------------------------------------------------------------------
<S>                                               <C>        <C>
REVENUES AND OTHER INCOME:
 Revenues                                         $10,116    $9,307
 Dividend and investee income                          80         4
 Net gains on disposal of assets                       20       107
 Gain on ownership change in Marathon Ashland
  Petroleum LLC                                         1         4
 Other income                                          68         7
                                                   ------    ------
     Total revenues and other income               10,285     9,429
                                                   ------    ------
COSTS AND EXPENSES:
 Cost of revenues (excludes items shown below)      7,769     7,213
 Selling, general and administrative expenses         125        71
 Depreciation, depletion and amortization             376       321
 Taxes other than income taxes                      1,181     1,163
 Exploration expenses                                  23        45
                                                   ------    ------
     Total costs and expenses                       9,474     8,813
                                                   ------    ------
INCOME FROM OPERATIONS                                811       616
Net interest and other financial costs                 23        95
Minority interest in income of Marathon Ashland
 Petroleum LLC                                        107        55
                                                   ------    ------
INCOME BEFORE INCOME TAXES AND CUMULATIVE EFFECT OF
 CHANGE IN ACCOUNTING PRINCIPLE                       681       466
Provision for income taxes                            164       169
                                                   ------    ------
INCOME BEFORE CUMULATIVE EFFECT OF CHANGE IN
 ACCOUNTING PRINCIPLE                                 517       297
Cumulative effect of change in accounting principle    (8)        -
                                                   ------    ------
NET INCOME                                            509       297
Dividends on preferred stock                            2         2
                                                   ------    ------
NET INCOME APPLICABLE TO COMMON STOCKS               $507      $295
                                                   ======    ======





<FN>
Selected notes to financial statements appear on pages 9-19.
</TABLE>


<PAGE> 5

<TABLE>
                    USX CORPORATION AND SUBSIDIARY COMPANIES
          CONSOLIDATED STATEMENT OF OPERATIONS (Continued) (Unaudited)
                             INCOME PER COMMON SHARE
          ------------------------------------------------------------
<CAPTION>                                      
                                                  First Quarter Ended
                                                        March 31
(Dollars in millions, except per share amounts)      2001      2000
-----------------------------------------------------------------------
<S>                                               <C>       <C>
APPLICABLE TO MARATHON STOCK:
 Income before cumulative effect of change in
  accounting principle                               $508      $254
    - Per share - basic and diluted                  1.65       .81
 Cumulative effect of change in accounting principle   (8)        -
    - Per share - basic and diluted                  (.03)        -
 Net income                                          $500      $254
    - Per share - basic and diluted                  1.62       .81

 Dividends paid per share                             .23       .21

 Weighted average shares, in thousands
    - Basic                                       308,753   312,128
    - Diluted                                     309,073   312,285

APPLICABLE TO STEEL STOCK:
 Net income                                            $7       $41
    - Per share - basic and diluted                   .08       .45

 Dividends paid per share                             .25       .25

 Weighted average shares, in thousands
    - Basic                                        88,806    88,422
    - Diluted                                      88,806    88,430





















<FN>
Selected notes to financial statements appear on pages 9-19.
</TABLE>


<PAGE> 6

<TABLE>
                    USX CORPORATION AND SUBSIDIARY COMPANIES
                     CONSOLIDATED BALANCE SHEET (Unaudited)
                    ----------------------------------------
<CAPTION>                                        
                                     ASSETS
                                                   March 31 December 31
(Dollars in millions)                                2001      2000
-----------------------------------------------------------------------
<S>                                                <C>       <C>
ASSETS

Current assets:
 Cash and cash equivalents                           $591      $559
 Receivables, less allowance for doubtful
  accounts of $133 and $60                          2,770     2,888
 Receivables subject to a security interest           350       350
 Inventories                                        2,997     2,813
 Deferred income tax benefits                         230       261
 Assets held for sale                                   -       330
 Other current assets                                 122       131
                                                   ------    ------
     Total current assets                           7,060     7,332

Investments and long-term receivables,
 less reserves of $26 and $28                       1,034       801
Property, plant and equipment, less accumulated
 depreciation, depletion and amortization of
 $16,484 and $16,222                               12,967    12,114
Prepaid pensions                                    2,886     2,879
Other noncurrent assets                               376       275
                                                   ------    ------
     Total assets                                 $24,323   $23,401
                                                   ======    ======






















<FN>
Selected notes to financial statements appear on pages 9-19.
</TABLE>


<PAGE> 7

<TABLE>
                    USX CORPORATION AND SUBSIDIARY COMPANIES
               CONSOLIDATED BALANCE SHEET (Continued) (Unaudited)
               --------------------------------------------------
<CAPTION>                                      
                      LIABILITIES AND STOCKHOLDERS' EQUITY
                                                   March 31  December 31
(Dollars in millions)                                2001        2000
--------------------------------------------------------------------------
<S>                                                <C>       <C>
LIABILITIES

Current liabilities:
 Notes payable                                       $400        $150
 Accounts payable                                   3,620       3,774
 Payroll and benefits payable                         455         432
 Accrued taxes                                        564         281
 Accrued interest                                      74         108
 Long-term debt due within one year                   301         287
                                                   ------      ------
     Total current liabilities                      5,414       5,032

Long-term debt, less unamortized discount           4,012       4,173
Deferred income taxes                               2,057       2,020
Employee benefits                                   2,543       2,415
Deferred credits and other liabilities                715         724
Preferred stock of subsidiary                         250         250
USX obligated mandatorily redeemable convertible preferred
 securities of a subsidiary trust holding solely junior
 subordinated convertible debentures of USX           183         183

Minority interest in Marathon Ashland Petroleum LLC 1,938       1,840

STOCKHOLDERS' EQUITY

Preferred stock -
 6.50% Cumulative Convertible issued - 2,404,487 shares
   and 2,413,487 shares ($120 and $121 liquidation
   preference, respectively)                            2           2
Common stocks:
 Marathon Stock issued - 312,165,978 shares and
  312,165,978 shares                                  312         312
 Steel Stock issued - 88,800,321 shares and
  88,767,395 shares                                    89          89
 Securities exchangeable solely into Marathon Stock
  issued - 280,348 shares and 281,148 shares            -           -
Treasury common stock, at cost -
 Marathon Stock - 3,576,723 shares and
  3,899,714 shares                                    (95)       (104)
Additional paid-in capital                          4,675       4,676
Deferred compensation                                 (15)         (8)
Retained earnings                                   2,261       1,847
Accumulated other comprehensive loss                  (18)        (50)
                                                   ------      ------
     Total stockholders' equity                     7,211       6,764
                                                   ------      ------
     Total liabilities and stockholders' equity   $24,323     $23,401
                                                   ======      ======
<FN>
Selected notes to financial statements appear on pages 9-19.
</TABLE>


<PAGE> 8

<TABLE>
                    USX CORPORATION AND SUBSIDIARY COMPANIES
                CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)
                ------------------------------------------------
<CAPTION>                                       
                                                  First Quarter Ended
                                                        March 31
(Dollars in millions)                                2001      2000
------------------------------------------------------------------------
<S>                                                <C>        <C>
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

OPERATING ACTIVITIES:
Net income                                           $509      $297
Adjustments to reconcile to net cash provided
 from operating activities:
 Cumulative effect of change in accounting principle    8         -
 Minority interest in income of Marathon Ashland
  Petroleum LLC                                       107        55
 Depreciation, depletion and amortization             376       321
 Exploratory dry well costs                             4        15
 Pensions and other postretirement benefits           (21)      (77)
 Deferred income taxes                               (179)       73
 Net gains on disposal of assets                      (20)     (107)
 Changes in:
     Current receivables                              190       (36)
     Inventories                                     (154)      (49)
     Current accounts payable and accrued expenses    (42)     (104)
 All other - net                                       36       (31)
                                                   ------    ------
     Net cash provided from operating activities      814       357
                                                   ------    ------
INVESTING ACTIVITIES:
Capital expenditures                                 (313)     (382)
Acquisition of Pennaco Energy, Inc.                  (506)        -
Disposal of assets                                     37       210
Restricted cash - withdrawals                          19       127
                - deposits                             (6)     (186)
All other - net                                         1        (5)
                                                   ------    ------
     Net cash used in investing activities           (768)     (236)
                                                   ------    ------
FINANCING ACTIVITIES:
Commercial paper and revolving credit arrangements
                                             - net     73       (21)
Other debt - borrowings                               139       231
           - repayments                              (125)     (255)
Preferred stock repurchased                             -       (11)
Dividends paid                                        (95)      (90)
Distributions to minority shareholder of
 Marathon Ashland Petroleum LLC                        (3)        -
                                                   ------    ------
     Net cash used in financing activities            (11)     (146)
                                                   ------    ------
EFFECT OF EXCHANGE RATE CHANGES ON CASH                (3)       (1)
                                                   ------    ------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS   32       (26)
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR        559       133
                                                   ------    ------
CASH AND CASH EQUIVALENTS AT END OF PERIOD           $591      $107
                                                   ======    ======
Cash provided from (used in) operating activities included:
 Interest and other financial costs paid (net of
  amount capitalized)                               $(127)    $(136)
 Income taxes refunded (paid)                          47       (19)



<FN>
Selected notes to financial statements appear on pages 9-19.
</TABLE>


<PAGE> 9
                    USX CORPORATION AND SUBSIDIARY COMPANIES
               SELECTED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              ----------------------------------------------------
                                   (Unaudited)

1.  The information furnished in these financial statements is unaudited
    but, in the opinion of management, reflects all adjustments necessary for a
    fair presentation of the results for the periods covered.  All such
    adjustments are of a normal recurring nature unless disclosed otherwise.
    These financial statements, including selected notes, have been prepared in
    accordance with the applicable rules of the Securities and Exchange
    Commission and do not include all of the information and disclosures
    required by generally accepted accounting principles for complete financial
    statements.  Certain reclassifications of prior year data have been made to
    conform to 2001 classifications.  Additional information is contained in
    the USX Annual Report on Form 10-K for the year ended December 31, 2000.

2.  Effective January 1, 2001, USX adopted Statement of Financial
    Accounting Standards No. 133, "Accounting for Derivative Instruments and
    Hedging Activities" (SFAS No. 133), as amended by SFAS Nos. 137 and 138.
    This Standard requires recognition of all derivatives as either assets or
    liabilities at fair value.

    The transition adjustment related to adopting SFAS No. 133 on January 1,
    2001, was recognized as a cumulative effect of change in accounting
    principle.  The unfavorable cumulative effect on net income, net of a tax
    benefit of $5 million, was $8 million.  The unfavorable cumulative effect
    on other comprehensive income (OCI), net of a tax benefit of $4 million,
    was $8 million.  The amounts reported as OCI will be reflected in net
    income when the anticipated physical transactions are consummated.

    The $8 million transition adjustment recorded in OCI at January 1,
    2001, included $42 million of net losses that were reclassified into income
    during the first quarter of 2001.  In future periods, $34 million of net
    gains will be reclassified into income relating to the OCI transition
    adjustment when the related physical transactions are completed.

3.  The Marathon Group's operations consist of three reportable operating
    segments: 1) Exploration and Production (E&P) - explores for and produces
    crude oil and natural gas on a worldwide basis; 2) Refining, Marketing and
    Transportation (RM&T) - refines, markets and transports crude oil and
    petroleum products, primarily in the Midwest and southeastern United States
    through Marathon Ashland Petroleum LLC (MAP); and 3) Other Energy Related
    Businesses (OERB).  OERB is an aggregation of two segments which fall below
    the quantitative reporting thresholds: 1) Natural Gas and Crude Oil
    Marketing and Transportation - markets and transports its own and third-
    party natural gas and crude oil in the United States; and 2) Power
    Generation - develops, constructs and operates independent electric power
    projects worldwide.

    The U. S. Steel Group consists of two reportable operating segments:
    1) Domestic Steel and 2) U. S. Steel Kosice (USSK).  Domestic Steel
    includes the United States operations of U. S. Steel while USSK includes
    the U. S. Steel Kosice operations primarily located in the Slovak Republic.
    Domestic Steel is engaged in the domestic production, sale and
    transportation of steel mill products, coke, taconite pellets and coal; the
    management of mineral resources; real estate development; and engineering
    and consulting services.  USSK is engaged in the production and sale of
    steel mill products and coke and primarily serves central European markets.

<PAGE> 10

                    USX CORPORATION AND SUBSIDIARY COMPANIES
         SELECTED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
         ---------------------------------------------------------------
                                   (Unaudited)


3.  (Continued)

         The results of segment operations for USX are as follows:

<TABLE>
                                                                 Total
                                                                Marathon
(In millions)                              E&P    RM&T    OERB  Segments
-----------------------------------------------------------------------------
<S>                                     <C>     <C>     <C>     <C> 
FIRST QUARTER 2001
-------------------
Revenues and other income:
  Customer                              $1,238  $6,742    $628   $8,608
  Intersegment (a)                         134       6      25      165
  Intergroup (a)                            10       -       2       12
  Equity in earnings of 
       unconsolidated investees             20       6       4       30
  Other                                      8      15       2       25
                                        ------  ------  ------   ------
  Total revenues and other income       $1,410  $6,769    $661   $8,840
                                        ======  ======  ======   ======
Segment income                            $600    $276      $8     $884
                                        ======  ======  ======   ======

FIRST QUARTER 2000
------------------
Revenues and other income:
  Customer                                $952  $6,427    $350   $7,729
  Intersegment (a)                          69      20      19      108
  Intergroup (a)                             5       -       5       10
  Equity in earnings (losses)
     of unconsolidated investees            (1)      4       4        7
  Other                                      3      11       4       18
                                        ------  ------  ------   ------
  Total revenues and other income       $1,028  $6,462    $382   $7,872
                                        ======  ======  ======   ======
Segment income                            $309    $140     $13     $462
                                        ======  ======  ======   ======

<FN>
(a)Intersegment and intergroup sales and transfers were conducted under terms
   comparable to those with unrelated parties.
</TABLE>


<PAGE> 11

                    USX CORPORATION AND SUBSIDIARY COMPANIES
         SELECTED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
         ---------------------------------------------------------------
                                   (Unaudited)


    3.   (Continued)

<TABLE>
                                                  Total       Total
                                  Domestic       U.S.Steel   Marathon
(In millions)                      Steel   USSK   Segments   Segments  Total
----------------------------------------------------------------------------
<S>                               <C>      <C>   <C>         <C>     <C>
FIRST QUARTER 2001
------------------
Revenues and other income:
  Customer                        $1,262   $246   $1,508     $8,608  $10,116
  Intersegment (a)                     1      -        1        165      166
  Intergroup (a)                       2      -        2         12       14
  Equity in earnings of 
        unconsolidated investees      47      -       47         30       77
  Other                                6      1        7         25       32
                                  ------ ------   ------     ------   ------
 Total revenues and other income  $1,318   $247   $1,565     $8,840  $10,405
                                  ====== ======   ======     ======   ======
Segment income (loss)              $(151)   $41    $(110)      $884     $774
                                  ====== ======   ======     ======   ======

FIRST QUARTER 2000
------------------
Revenues and other income:
  Customer                        $1,578     $-   $1,578     $7,729   $9,307
  Intersegment (a)                     -      -        -        108      108
  Intergroup (a)                       4      -        4         10       14
  Equity in earnings (losses) of
        unconsolidated investees      (7)     -       (7)         7        -
  Other                               13      -       13         18       31
                                  ------ ------   ------     ------   ------
 Total revenues and other income  $1,588     $-   $1,588     $7,872   $9,460
                                  ====== ======   ======     ======   ======
Segment income                       $54     $-      $54       $462     $516
                                  ====== ======   ======     ======   ======

<FN>
(a)Intersegment and intergroup sales and transfers were conducted under terms
   comparable to those with unrelated parties.
</TABLE>


<PAGE> 12

                    USX CORPORATION AND SUBSIDIARY COMPANIES
         SELECTED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
         ---------------------------------------------------------------
                                   (Unaudited)
                                        

3.  (Continued)


    The following schedule reconciles segment revenues and income to amounts
    reported in the Marathon and U. S. Steel Groups' financial statements:

<TABLE>
                                         Marathon Group   U. S. Steel Group
                                         First Quarter     First Quarter
                                             Ended             Ended
                                            March 31          March 31
(In millions)                              2001   2000      2001   2000
-----------------------------------------------------------------------------
<S>                                      <C>    <C>       <C>    <C>
Revenues and other income:
 Revenues and other income 
     of reportable segments              $8,840 $7,872    $1,565 $1,588
 Items not allocated to segments:
  Gain on ownership change in MAP             1      4         -      -
  Other (a)                                  59     87         -      -
 Elimination of intersegment revenues      (165)  (108)       (1)     -
                                         ------  ------    -----  -----
  Total Group revenues and other income  $8,735  $7,855   $1,564 $1,588
                                         ======  ======   ====== ======

Income:
 Income (loss) for reportable segments     $884    $462    $(110)   $54
 Items not allocated to segments:
  Gain on ownership change in MAP             1       4        -      -
  Administrative expenses                   (32)    (28)      (8)    (6)
  Net pension credits                         -       -       41     65
  Costs related to former business activities -       -      (24)   (22)
  Other (a)                                  59      87        -      -
                                         ------  ------   ------ ------
 Total Group income (loss) from operations $912    $525    $(101)   $91
                                         ======  ======   ====== ======
<FN>
(a) Represents in 2001 for the Marathon Group, gain on offshore lease
    resolution with the U.S. Government and in 2000, gain on disposition of
    Angus/Stellaria.
</TABLE>


<PAGE> 13

                    USX CORPORATION AND SUBSIDIARY COMPANIES
         SELECTED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
         ---------------------------------------------------------------
                                   (Unaudited)


4.  In the first quarter 2001, Marathon Oil Company (Marathon) acquired
    Pennaco Energy, Inc. (Pennaco), a natural gas producer.  Marathon acquired
    87% of the outstanding stock of Pennaco through a tender offer completed on
    February 7, 2001 at $19 a share.  On March 26, 2001, Pennaco was merged
    with a wholly owned subsidiary of Marathon.  Under the terms of the merger,
    each share not held by Marathon was converted into the right to receive $19
    in cash.  The total cash purchase price of Pennaco was $506 million.  The
    acquisition was accounted for under the purchase method of accounting.  The
    excess of the purchase price over the preliminary fair value of net assets
    acquired (goodwill) approximates $64 million and will be amortized over 17
    years.  First quarter results of operations include the results of Pennaco
    from February 7, 2001.

    On March 1, 2001, USX completed the purchase of the tin mill products
    business of LTV Corporation (LTV).  In this noncash transaction, USX
    assumed certain employee related obligations of LTV.  The acquisition was
    accounted for using the purchase method of accounting.  First quarter 2001
    results of operations include the operations of the LTV assets acquired
    from the date of acquisition.

    On March 23, 2001, Transtar, Inc. (Transtar) completed its previously
    announced reorganization with its two voting shareholders, USX and Transtar
    Holdings, L.P. (Holdings), an affiliate of Blackstone Capital Partners L.P.
    As a result of this transaction, USX became sole owner of Transtar and
    certain of its subsidiaries.  Holdings became owner of the other
    subsidiaries of Transtar.  USX accounted for the change in its ownership
    interest in Transtar using the purchase method of accounting.  USX
    recognized in the first quarter of 2001, a pretax gain of $70 million
    (included in dividend and investee income) and a favorable deferred tax
    adjustment of $33 million related to this transaction.  USX previously
    accounted for its investment in Transtar under the equity method of
    accounting.

    The following unaudited pro forma data for USX includes the results of
    operations of the above acquisitions giving effect to them as if they had
    been consummated at the beginning of the years presented.  The pro forma
    data is based on historical information and does not necessarily reflect
    the actual results that would have occurred nor is it necessarily
    indicative of future results of operations.



<PAGE> 14

                    USX CORPORATION AND SUBSIDIARY COMPANIES
         SELECTED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
         ---------------------------------------------------------------
                                   (Unaudited)


4.  (Continued)


<TABLE>
                                                         First
                                                     Quarter Ended
                                                        March 31
     (In millions, except per share amounts)         2001      2000
     -----------------------------------------------------------------------
     <S>                                          <C>        <C>
     Revenues and other income                    $10,269    $9,508
     Income before cumulative effect of change in
      accounting principle                            411       290
      - Per common share:
        Marathon Stock - basic and diluted           1.64       .78
        Steel Stock - basic and diluted             (1.09)      .49
     Net income                                       403       290
      - Per common share:
        Marathon Stock - basic and diluted           1.61       .78
        Steel Stock - basic and diluted             (1.09)      .49
</TABLE>

    On November 24, 2000, USX acquired U. S. Steel Kosice s.r.o. (USSK),
    which is primarily located in the Slovak Republic.  USSK was formed in June
    2000 to hold the steel operations and related assets of VSZ a.s. (VSZ), a
    diversified Slovak corporation.   The acquisition was accounted for under
    the purchase method of accounting.  VSZ did not provide historical carve-
    out financial information for its steel activities prepared in accordance
    with generally accepted accounting principles in the United States.  USX
    was unable to fully determine the effects of transfer pricing, intercompany
    eliminations and expense allocations in order to prepare such carve-out
    information from Slovak statutory reports and VSZ internal records.  USX
    broadly estimates that the unaudited pro forma effect on its first quarter
    2000 revenues, giving effect to the acquisition as if it had been
    consummated at the beginning of this period, would have been to increase
    revenues in the period by approximately $250 million.  USX cannot determine
    the unaudited pro forma effect on its first quarter 2000 net income.
    However, historical pro forma information is not necessarily indicative of
    future results of operations.

5.  In December 2000, Marathon and Kinder Morgan Energy Partners, L.P.
    signed a definitive agreement to form a joint venture combining certain of
    their oil and gas producing activities in the U.S. Permian Basin, including
    Marathon's interest in the Yates Field.  This transaction has allowed
    Marathon to expand its interests in the Permian Basin and improve access to
    materials for use in enhanced recovery techniques in the Yates Field.  The
    joint venture, named MKM Partners L.P., commenced operations in January
    2001 and is accounted for under the equity method of accounting.


<PAGE> 15

                    USX CORPORATION AND SUBSIDIARY COMPANIES
         SELECTED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
         ---------------------------------------------------------------
                                   (Unaudited)


6.  Inventories are carried at lower of cost or market.  Cost of
    inventories is determined primarily under the last-in, first-out (LIFO)
    method.

<TABLE>
                                                     (In millions)
                                                 ----------------------
                                                  March 31  December 31
                                                     2001      2000
                                                  --------  -----------
    <S>                                           <C>       <C>
    Raw materials                                  $1,026      $915
    Semi-finished products                            434       429
    Finished products                               1,360     1,279
    Supplies and sundry items                         177       190
                                                   ------    ------
      Total                                        $2,997    $2,813
                                                   ======    ======
</TABLE>

7.  Total comprehensive income was $541 million for the first quarter of
    2001 and $296 million for the first quarter of 2000.

8.  The method of calculating net income per share for the Marathon Stock
    and Steel Stock reflects the USX Board of Directors' intent that the
    separately reported earnings and surplus of the Marathon Group and the
    U. S. Steel Group, as determined consistent with the USX Restated
    Certificate of Incorporation, are available for payment of dividends on the
    respective classes of stock, although legally available funds and
    liquidation preferences of these classes of stock do not necessarily
    correspond with these amounts.  The financial statements of the Marathon
    Group and the U. S. Steel Group, taken together, include all accounts which
    comprise the corresponding consolidated financial statements of USX.

    Basic net income per share is calculated by adjusting net income for
    dividend requirements of preferred stock and is based on the weighted
    average number of common shares outstanding.

    Diluted net income per share assumes exercise of stock options,
    provided the effect is not antidilutive.

<PAGE> 16

                    USX CORPORATION AND SUBSIDIARY COMPANIES
         SELECTED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
         ---------------------------------------------------------------
                                   (Unaudited)


8.  (Continued)

<TABLE>
         COMPUTATION OF INCOME PER SHARE
                                                First Quarter Ended
                                                      March 31
                                                2001           2000
                                            Basic Diluted   Basic Diluted
---------------------------------------------------------------------------
<S>                                        <C>    <C>      <C>    <C>
Marathon Group
---------------
Net income (millions):
 Income before cumulative effect of change
      in accounting principle                $508   $508     $254    $254
 Cumulative effect of change in
      accounting principle                     (8)    (8)       -       -
                                           ------  ------  ------  ------
 Net income                                  $500    $500    $254    $254
                                           ======  ======  ======  ======
Shares of common stock outstanding (thousands):
Average number of common shares 
                    outstanding           308,753 308,753 312,128 312,128
Effect of dilutive securities
              - stock options                   -     320       -     157
                                           ------  ------  ------  ------
Average common shares and dilutive effect 308,753 309,073 312,128 312,285
                                           ======  ======  ======  ======

Per share:
Income before cumulative effect of change
  in accounting principle                   $1.65   $1.65    $.81    $.81
Cumulative effect of change in accounting
  principle                                  (.03)   (.03)      -       -
                                           ------  ------  ------  ------
         Net income                         $1.62   $1.62    $.81    $.81
                                           ======  ======  ======  ======

U. S. Steel Group
-----------------
Net income (millions):
 Net income                                    $9      $9     $43     $43
 Dividends on preferred stock                   2       2       2       2
                                           ------  ------  ------  ------
     Net income applicable to Steel Stock      $7      $7     $41     $41
                                           ======  ======  ======  ======
Shares of common stock outstanding (thousands):
Average number of common shares 
                 outstanding               88,806  88,806  88,422  88,422
Effect of dilutive securities
                 - stock options                -       -       -       8
                                           ------  ------  ------  ------
Average common shares and dilutive effect  88,806  88,806  88,422  88,430
                                           ======  ======  ======  ======
Net income per share                         $.08    $.08    $.45    $.45
</TABLE>
                                   ======  ======  ======  ======

<PAGE> 17

                    USX CORPORATION AND SUBSIDIARY COMPANIES
         SELECTED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
         ---------------------------------------------------------------
                                   (Unaudited)
                                        
                                        
9.  Included in revenues and costs and expenses for the first quarter of
    2001 and 2000 were $1,038 million and $1,039 million, respectively,
    representing excise taxes on petroleum products and merchandise.

10. The provision for income taxes for the periods reported is based on
    tax rates and amounts which recognize management's best estimate of current
    and deferred tax assets and liabilities.

    In the first quarter of 2001, interest and other financial costs
    includes a favorable adjustment of $76 million and provision for income
    taxes includes an unfavorable adjustment of $20 million, both of which are
    related to prior years' taxes.

11. At March 31, 2001, USX had $200 million in borrowings against its
    $1,354 million long-term revolving credit facility and no borrowings
    against its $451 million short-term revolving credit facility.

    Certain banks provide USX with short-term lines of credit totaling
    $150 million which require a .125% fee or maintenance of compensating
    balances of 3%.  At March 31, 2001, there were no borrowings against these
    facilities.

    At March 31, 2001, MAP had no borrowings against its $500 million
    revolving credit agreements with banks and had no amounts outstanding
    against its $190 million revolving credit agreement with Ashland, which was
    amended and extended for one year to March 15, 2002.

    At March 31, 2001, USSK had no borrowings against its $50 million
    short-term credit facility.

    At March 31, 2001, in the event of a change in control of USX, debt
    obligations totaling $3,531 million and operating lease obligations of
    $101 million may be declared immediately due and payable.  In such event,
    USX may also be required to either repurchase the leased Fairfield slab
    caster for $100 million or provide a letter of credit to secure the
    remaining obligation.

12. On February 16, 2001, USX borrowed $250 million under a six-month term
    loan facility agreement.  The loan is unsecured and any borrowings bear
    interest at defined short-term market rates.  At March 31, 2001, $250
    million had been borrowed against this facility.

    On March 30, 2001, USX borrowed $30 million under a five-year
    promissory note agreement.  The amount borrowed is unsecured and requires
    quarterly principal payments and interest at a rate of 6.57%.  At March 31,
    2001, $30 million was outstanding under the agreement.

<PAGE> 18

                    USX CORPORATION AND SUBSIDIARY COMPANIES
         SELECTED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
         ---------------------------------------------------------------
                                   (Unaudited)


13. In 1998, USX redeemed all shares of USX-Delhi Group Common Stock.
    After the redemption, 50,000,000 shares of this stock remain authorized but
    unissued.

14. USX is the subject of, or a party to, a number of pending or
    threatened legal actions, contingencies and commitments involving a variety
    of matters, including laws and regulations relating to the environment.
    Certain of these matters are discussed below.  The ultimate resolution of
    these contingencies could, individually or in the aggregate, be material to
    the consolidated financial statements.  However, management believes that
    USX will remain a viable and competitive enterprise even though it is
    possible that these contingencies could be resolved unfavorably.  See
    discussion of Liquidity in USX Consolidated Management's Discussion and
    Analysis of Financial Condition and Results of Operations.

    USX is subject to federal, state, local and foreign laws and
    regulations relating to the environment.  These laws generally provide for
    control of pollutants released into the environment and require responsible
    parties to undertake remediation of hazardous waste disposal sites.
    Penalties may be imposed for noncompliance.  At March 31, 2001, and 
    December 31, 2000, accrued liabilities for remediation totaled $226 million
    and $212 million, respectively.  It is not presently possible to estimate 
    the ultimate amount of all remediation costs that might be incurred or the 
    penalties that may be imposed.  Receivables for recoverable costs from 
    certain states, under programs to assist companies in cleanup efforts 
    related to underground storage tanks at retail marketing outlets, were 
    $64 million at March 31, 2001, and $57 million at December 31, 2000.

    For a number of years, USX has made substantial capital expenditures
    to bring existing facilities into compliance with various laws relating to
    the environment.  In the first quarter of 2001 and for the years 2000 and
    1999, such capital expenditures totaled $9 million, $91 million and $78
    million, respectively.  USX anticipates making additional such expenditures
    in the future; however, the exact amounts and timing of such expenditures
    are uncertain because of the continuing evolution of specific regulatory
    requirements.

    At March 31, 2001, and December 31, 2000, accrued liabilities for
    platform abandonment and dismantlement totaled $170 million and $162
    million, respectively.

    Guarantees by USX of the liabilities of affiliated entities totaled
    $68 million at March 31, 2001.  In the event that any defaults of
    guaranteed liabilities occur, USX has access to its interest in the assets
    of most of the affiliates to reduce losses resulting from these guarantees.
    As of March 31, 2001, the largest guarantee for a single affiliate was $59
    million.


<PAGE> 19

                    USX CORPORATION AND SUBSIDIARY COMPANIES
         SELECTED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
         ---------------------------------------------------------------
                                   (Unaudited)


14. (Continued)

    At March 31, 2001, USX's pro rata share of obligations of LOOP LLC and
    various pipeline affiliates secured by throughput and deficiency agreements
    totaled $119 million.  Under the agreements, USX is required to advance
    funds if the affiliates are unable to service debt.  Any such advances are
    prepayments of future transportation charges.

    Contract commitments to acquire property, plant and equipment and long-
    term investments at March 31, 2001, totaled $778 million compared with $663
    million at December 31, 2000.

15. USX has a 16% investment in Republic Technologies International LLC
    (Republic) which was accounted for under the equity method of accounting.
    During the first quarter of 2001, USX discontinued applying the equity
    method since investments in and advances to Republic had been reduced to
    zero.  Also, USX has recognized certain debt obligations of $14 million
    previously assumed by Republic.  On April 2, 2001, Republic filed a
    voluntary petition with the U.S. Bankruptcy Court to reorganize its
    operations under Chapter 11 of the U.S. Bankruptcy Code.  In the first
    quarter of 2001, as a result of Republic's action, USX recorded a pretax
    charge of $74 million for potentially uncollectible receivables from
    Republic.

<PAGE> 20

<TABLE>
<CAPTION>
                                 USX CORPORATION
           COMPUTATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES
                          AND PREFERRED STOCK DIVIDENDS
                      TOTAL ENTERPRISE BASIS - (Unaudited)
                              CONTINUING OPERATIONS
           ----------------------------------------------------------
                                        

First Quarter Ended
    March 31                      Year Ended December 31
--------------------  --------------------------------------------------------
  <C>        <C>       <C>       <C>       <C>       <C>       <C>
   2001      2000      2000      1999      1998      1997      1996
   ----      ----      ----      ----      ----      ----      ----

  13.79      5.16      3.79      4.20      3.45      3.63      3.41
   ====      ====      ====      ====      ====      ====      ====
</TABLE>




<TABLE>
<CAPTION>
                                 USX CORPORATION
                COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
                      TOTAL ENTERPRISE BASIS - (Unaudited)
                              CONTINUING OPERATIONS
                -------------------------------------------------


First Quarter Ended
    March 31                      Year Ended December 31
--------------------  --------------------------------------------------------
  <C>        <C>       <C>       <C>       <C>       <C>       <C>  
   2001      2000      2000      1999      1998      1997      1996
   ----      ----      ----      ----      ----      ----      ----

  14.56      5.29      3.89      4.32      3.56      3.79      3.65
   ====      ====      ====      ====      ====      ====      ====
</TABLE>


<PAGE> 21

                    USX CORPORATION AND SUBSIDIARY COMPANIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                  ---------------------------------------------

     USX Corporation ("USX") is a diversified company that is principally
engaged in the energy business through its Marathon Group and in the steel
business through its U. S. Steel Group. The following discussion should be read
in conjunction with the first quarter 2001 USX Consolidated Financial Statements
and selected notes. For income per common share amounts applicable to USX's two
classes of common stock, USX-Marathon Group Common Stock ("Marathon Stock") and
USX-U. S. Steel Group Common Stock ("Steel Stock"), see Consolidated Statement
of Operations - Income per Common Share. For individual Group results, see

Management's Discussion and Analysis of Financial Condition and Results of
Operations for the Marathon Group and the U. S. Steel Group. For operating
statistics, see Supplemental Statistics following Management's Discussion and
Analysis of Financial Condition and Results of Operations for each of the
respective Groups.

     On April 24, 2001, USX announced that its Board of Directors authorized
management to proceed with the necessary steps to implement a plan of
reorganization of the corporation in order to separate the energy and steel
businesses.  The plan envisions a tax-free spin-off of the steel and steel-
related businesses of USX Corporation into a freestanding, publicly traded
company to be known as United States Steel Corporation ("U. S. Steel").  Holders
of current Steel Stock would become holders of United States Steel Corporation
Common Stock.  Holders of current Marathon Stock would become holders of
Marathon Oil Company Common Stock.  The plan does not contemplate a cash
distribution to shareholders. Each new company would carry approximately the
same assets and liabilities now associated with its existing businesses, except
for a value transfer of approximately $900 million from Marathon Oil Company to
U. S. Steel, intended to maintain U. S. Steel as a strong, independent company.
The form of the value transfer would be a reallocation of USX corporate debt
between the current Marathon Group and the U. S. Steel Group.  The plan of
reorganization is subject to the approval of a majority of the outstanding
shares of each class of the current USX common stock, receipt of a favorable tax
ruling from the Internal Revenue Service ("IRS") on the tax-free nature of the
transaction, completion of necessary financing arrangements, receipt of
necessary regulatory and third party consents, and board approval of definitive
documentation for the transaction.  The transaction is expected to occur at 
year-end, subject to the absence of any materially adverse change in business
conditions for the energy and/or steel business, delay in obtaining the IRS
ruling or other unfavorable circumstances.

     Certain sections of Management's Discussion and Analysis include forward-
looking statements concerning trends or events potentially affecting USX. These
statements typically contain words such as "anticipates", "believes",
"estimates", "expects" or similar words indicating that future outcomes are
uncertain. In accordance with "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995, these statements are accompanied by cautionary
language identifying important factors, though not necessarily all such factors,
that could cause future outcomes to differ materially from those set forth in
the forward-looking statements. For additional risk factors affecting the
businesses of USX, see Supplementary Data - Disclosures About Forward-Looking
Statements in the USX 2000 Form 10-K.

<PAGE> 22

                    USX CORPORATION AND SUBSIDIARY COMPANIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                  ---------------------------------------------


Results of Operations
---------------------

     Revenues and other income for the first quarter of 2001 and 2000 are set
forth in the following table:

<TABLE>
                                                  First Quarter Ended
                                                        March 31
(Dollars in millions)                                2001      2000
-----------------------------------------------------------------------------
<S>                                                <C>       <C>
Revenues and other income
 Marathon Group                                    $8,735    $7,855
 U. S. Steel Group                                  1,564     1,588
 Eliminations                                         (14)      (14)
                                                   ------    ------
  Total USX Corporation revenues and other income  10,285     9,429
Less:
 Excise taxes(a)                                    1,038     1,039
                                                   ------    ------
  Revenues and other income - excluding above item $9,247    $8,390
                                                   ======    ======
------
<FN>
(a)  Consumer excise taxes on petroleum products and merchandise are included in
     both revenues and costs and expenses for the Marathon Group and USX
     Consolidated.
</TABLE>

     Revenues and other income (excluding excise taxes) increased $857 million
in the first quarter of 2001 compared with the first quarter of 2000, reflecting
an increase of 13 percent for the Marathon Group and a decrease of 2 percent for
the U. S. Steel Group.

     For discussion of revenues by Group, see Management's Discussion and
Analysis of Financial Condition and Results of Operations for the Marathon Group
and the U. S. Steel Group.

<PAGE> 23

                    USX CORPORATION AND SUBSIDIARY COMPANIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                  ---------------------------------------------

     Income from operations for the first quarter of 2001 and 2000 are set forth
in the following table:

<TABLE>
                                                    First Quarter Ended
                                                          March 31
(Dollars in millions)                                   2001    2000
-----------------------------------------------------------------------------
<S>                                                    <C>      <C>
Reportable segments
 Marathon Group
 Exploration & production                               $600    $309
 Refining, marketing & transportation                    276     140
 Other energy related businesses                           8      13
                                                       -----   -----
   Income for reportable segments - Marathon Group       884     462

 U. S. Steel Group
 Domestic Steel                                         (151)     54
 U. S. Steel Kosice                                       41       -
                                                       -----   -----
   Income (loss) for reportable segments 
                           - U. S. Steel Group          (110)     54

   Income for reportable segments - USX Corporation     $774    $516

Items not allocated to reportable segments:
 Marathon Group                                           28      63
 U. S. Steel Group                                         9      37
                                                       -----   -----
   Total income from operations - USX Corporation       $811    $616
</TABLE>

     Income for reportable segments increased $258 million in the first quarter
of 2001 as compared with the first quarter of 2000, reflecting increases of $422
million for the Marathon Group reportable segments and decreases of $164 million
for the U. S. Steel Group reportable segments.

     For discussion of income from operations by segment, see Management's
Discussion and Analysis of Financial Condition and Results of Operations for the
Marathon Group and the U. S. Steel Group.

<PAGE> 24

                    USX CORPORATION AND SUBSIDIARY COMPANIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                  ---------------------------------------------

     Net interest and other financial costs for the first quarters of 2001 and
2000 are set forth in the following table:

<TABLE>
                                                        First Quarter
                                                            Ended
                                                           March 31
(Dollars in millions)                                   2001    2000
-------------------------------------------------------------------------
<S>                                                    <C>     <C> 
Net interest and other financial costs                   $23     $95
Less:
 Favorable adjustment to interest
      related to prior years' taxes                      (76)      -
                                                       -----   -----
Net interest and other financial costs
                      adjusted to exclude above item     $99     $95
                                                       =====   =====
</TABLE>

     Adjusted net interest and other financial costs increased by $4 million in
the first quarter of 2001 as compared with the same period in 2000.  This
increase was primarily due to a higher average debt level.

     The minority interest in income of MAP, which represents Ashland's 38
percent ownership interest, increased $52 million in the first quarter of 2001
from the comparable 2000 period, due to higher RM&T segment income.  For further
discussion, see Management's Discussion and Analysis of Financial Condition and
Results of Operations for the Marathon Group.

     Provision for income taxes of $164 million in the first quarter of 2001 and
$169 million for the first quarter of 2000, were based on tax rates and amounts
that recognize management's best estimate of current and deferred tax assets and
liabilities.  In the first quarter of 2001, the provision included a $33 million
tax benefit associated with the Transtar reorganization and an unfavorable
adjustment of $20 million related to prior years' taxes.

     Cumulative effect of change in accounting principle of $8 million, net of a
tax benefit of $5 million, in the first quarter of 2001 was an unfavorable
transition adjustment related to adopting SFAS No. 133.  For further discussion,
see Note 2 to the USX Consolidated Financial Statements.

     Net income in the first quarter of 2001 was $509 million, an increase of
$212 million from the first quarter of 2000, reflecting an increase of $246
million for the Marathon Group and a decrease of $34 million for the U. S. Steel
Group.

Dividends to Stockholders
-------------------------
     On April 24, 2001, the USX Board of Directors (the "Board") declared
dividends of 23 cents per share on Marathon Stock and 10 cents per share on
Steel Stock, a decrease of 15 cents per share on Steel Stock, both payable
June 9, 2001, to stockholders of record at the close of business on May 16,
2001.  The Board also declared a dividend of $0.8125 per share on USX's
6.50% Cumulative Convertible Preferred Stock, payable June 29, 2001, to
stockholders of record at the close of business on May 31, 2001.

<PAGE> 25

                    USX CORPORATION AND SUBSIDIARY COMPANIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                  ---------------------------------------------

     On April 24, 2001, Marathon Oil Canada Limited, an indirect subsidiary of
Marathon Oil Company, declared a dividend of CDN $0.3561 per share on its non-
voting Exchangeable Shares, payable June 9, 2001, to stockholders of record at
the close of business on May 16, 2001.  Previously, Marathon Oil Canada Limited
announced that the redemption of these Exchangeable Shares will be accelerated
to August 13, 2001.  These shares will be exchanged for Marathon Stock on a one-
for-one basis.

Cash Flows
----------
     Cash and cash equivalents totaled $591 million at March 31, 2001, compared
with $107 million at March 31, 2000, reflecting increases of $309 million for
the Marathon Group and $175 million for the U. S. Steel Group.  These increases
primarily reflect an increase in cash held by certain foreign subsidiaries.

     Net cash provided from operating activities totaled $814 million in the
first quarter of 2001, compared with $357 million in the first quarter of 2000.
The $457 million increase mainly reflected improved net income and working 
capital changes.

     Capital expenditures for property, plant and equipment in the first quarter
of 2001 were $313 million, compared with $382 million in the first quarter of
2000. For further details, see Management's Discussion and Analysis of Financial
Condition and Results of Operations for each of the respective Groups.

     The acquisition of Pennaco Energy, Inc. ("Pennaco") included cash payments
of $506 million.  For further discussion of Pennaco, see Note 4 to the USX
Consolidated Financial Statements.

     Cash from disposal of assets in the first quarter of 2001 was $37 million,
compared with $210 million in the first quarter of 2000.  Proceeds in 2000 were
mainly from the disposition of Marathon's 33.34 percent interest in the
Angus/Stellaria development in the Gulf of Mexico.

     The net change in restricted cash was a net withdrawal of $13 million in
the first quarter of 2001 compared with a net deposit of $59 million in the
first quarter of 2000.  Restricted cash in both periods primarily reflected the
net effects of cash deposited and withdrawn from domestic production property
dispositions and acquisitions.

     Financial obligations (the net of commercial paper and revolving credit
arrangements, debt borrowings and repayments on the Consolidated Statement of
Cash Flows) increased $87 million in the first quarter of 2001 compared with a
decrease of $45 million in the first quarter of 2000.  The increase in 2001
reflects cash used for capital expenditures, acquisition of Pennaco and dividend
payments that were greater than net cash provided from operating activities and
asset sales.

     Contract commitments to acquire property, plant and equipment and long-term
investments at March 31, 2001, totaled $778 million compared with $663 million
at December 31, 2000.

<PAGE> 26
                    USX CORPORATION AND SUBSIDIARY COMPANIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                  ---------------------------------------------
                                        
Debt and Preferred Stock Ratings
--------------------------------
     Standard & Poor's Corp. rates USX's and Marathon's senior debt BBB, USX's
subordinated debt BBB- and preferred stock BB+.  Moody's Investor Services, Inc.
rates USX's and Marathon's senior debt Baa1, USX's subordinated debt Baa2 and
USX's preferred stock baa3.  Fitch IBCA Duff & Phelps rates USX's senior notes
BBB and USX's subordinated debt as BBB-.  All senior debt holds an investment
grade rating.  On April 24, 2001, after USX announced the plan of
reorganization, Standard & Poor's maintained the current rating on USX debt and
the "Credit Watch Developing" status and Fitch IBCA Duff & Phelps advised that
they had raised the Rating Watch status on USX to "Positive".

Liquidity
---------
     At March 31, 2001, USX had $200 million of borrowings against its $1,354
million long-term revolving credit agreement, no borrowings against its $451
million 364-day facility and no commercial paper borrowings.  There were no
borrowings against USX's short-term lines of credit totaling $150 million at
March 31, 2001.  At March 31, 2001, there were no borrowings against MAP or USSK
revolving credit agreements.

     USX management believes that its short-term and long-term liquidity is
adequate to satisfy its obligations as of March 31, 2001, and to complete
currently authorized capital spending programs.  Future requirements for USX's
business needs, including the funding of capital expenditures, debt maturities
for the balance of 2001 and years 2002 and 2003, and any amounts that may
ultimately be paid in connection with contingencies (which are discussed in Note
14 to the USX Consolidated Financial Statements), are expected to be financed by
a combination of internally generated funds, proceeds from the sale of stock,
borrowings and other external financing sources.  However, on April 24, 2001,
USX announced that the Board had authorized management to proceed with the
necessary steps to implement a plan of reorganization of the corporation in
order to separate the energy and steel businesses.  Until the plan of
reorganization is implemented or abandoned, USX management believes that it will
be more difficult to access traditional debt and equity markets.  Although USX
management believes that it will not be necessary to access financial markets
during this time frame, nontraditional sources should be available to provide
adequate liquidity, if necessary.

     USX management's opinion concerning liquidity and USX's ability to avail
itself in the future of the financing options mentioned in the above forward-
looking statements are based on currently available information.  To the extent
that this information proves to be inaccurate, future availability of financing
may be adversely affected.  Factors that could affect the availability of
financing include the performance of each Group (as measured by various factors
including cash provided from operating activities), the state of worldwide debt
and equity markets, investor perceptions and expectations of past and future
performance, the overall U.S. financial climate, and, in particular, with
respect to borrowings, by levels of USX's outstanding debt and credit ratings by
rating agencies.

<PAGE> 27

                    USX CORPORATION AND SUBSIDIARY COMPANIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                  ---------------------------------------------

Environmental Matters, Contingencies and Commitments
----------------------------------------------------
     USX has incurred and will continue to incur substantial capital, operating
and maintenance, and remediation expenditures as a result of environmental laws
and regulations.  To the extent these expenditures, as with all costs, are not
ultimately reflected in the prices of USX's products and services, operating
results will be adversely affected.  USX believes that domestic competitors of
the U. S. Steel Group and substantially all the competitors of the Marathon
Group are subject to similar environmental laws and regulations.  However, the
specific impact on each competitor may vary depending on a number of factors,
including the age and location of its operating facilities, marketing areas,
production processes and the specific products and services it provides.

     USX has been notified that it is a potentially responsible party ("PRP") at
36 waste sites under the Comprehensive Environmental Response, Compensation and
Liability Act ("CERCLA") as of March 31, 2001.  In addition, there are 21 sites
where USX has received information requests or other indications that USX may be
a PRP under CERCLA but where sufficient information is not presently available
to confirm the existence of liability.  There are also 143 additional sites,
excluding retail gasoline stations, where remediation is being sought under
other environmental statutes, both federal and state, or where private parties
are seeking remediation through discussions or litigation.  Of these sites, 14
were associated with properties conveyed to MAP by Ashland for which Ashland has
retained liability for all costs associated with remediation.  At many of these
sites, USX is one of a number of parties involved and the total cost of
remediation, as well as USX's share thereof, is frequently dependent upon the
outcome of investigations and remedial studies.  USX accrues for environmental
remediation activities when the responsibility to remediate is probable and the
amount of associated costs is reasonably determinable.  As environmental
remediation matters proceed toward ultimate resolution or as additional
remediation obligations arise, charges in excess of those previously accrued may
be required.

     New Tier II gasoline rules, which were finalized by the U.S. Environmental
Protection Agency ("EPA") in February 2000, and the diesel fuel rule which was
finalized in January 2001, require substantially reduced sulfur levels.  The
combined capital cost to achieve compliance with the gasoline and diesel
regulations could amount to approximately $700 million between 2003 and 2005.
This is a forward-looking statement and can only be a broad-based estimate due
to the ongoing evolution of regulatory requirements.  Some factors (among
others) that could potentially affect gasoline and diesel fuel compliance costs
include obtaining the necessary construction and environmental permits,
operating and logistical considerations, and unforeseen hazards such as weather
conditions.

     In October 1998, the National Enforcement Investigations Center and Region
V of the EPA conducted a multi-media inspection of MAP's Detroit refinery.
Subsequently, in November 1998, Region V conducted a multi-media inspection of
MAP's Robinson refinery.  These inspections covered compliance with the Clean
Air Act (New Source Performance Standards, Prevention of Significant
Deterioration, and the National Emission Standards for Hazardous Air Pollutants
for Benzene), the Clean Water Act (Permit exceedances for the Waste Water
Treatment Plant), reporting obligations under the Emergency Planning and
Community Right to Know Act and the handling of process waste.  MAP has been
served with two Notices of Violation ("NOV") and three Findings of Violation in
connection with the multi-media inspections at its Detroit refinery.  The
Detroit notices allege violations of the Michigan State Air Pollution
Regulations, the EPA New Source Performance Standards

<PAGE> 28

                    USX CORPORATION AND SUBSIDIARY COMPANIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                  ---------------------------------------------

and National Emission Standards for Hazardous Air Pollutant for benzene.  On
March 6, 2000, MAP received its first NOV arising out of the multi-media
inspection of the Robinson Refinery conducted in November 1998.  The NOV is for
alleged Resource Conservation and Recovery Act (hazardous waste) violations.

     MAP has recently settled with the EPA certain New Source Review ("NSR")
compliance issues as well as multi-media issues related to the EPA's 1998 
multi-media inspections of the Detroit and Robinson refineries.  MAP's
settlement with the EPA includes all of MAP's refineries and commits MAP to 
specific control technologies and implementation schedules for approximately 
$263 million in environmental capital expenditures and improvements to MAP's 
refineries over approximately an 8 year period that are consistent with MAP's 
current capital spending plans.  It also commits MAP to payment of an aggregate
civil penalty in the amount of $3.8 million and the performance of $6.5 million 
in supplemental environmental projects as a part of an enforcement action for
alleged Clean Air Act violations.  MAP believes that the settlement will 
provide MAP with increased permitting and operating flexibility while achieving
significant emission reductions.

     In October 1996, USX was notified by the Indiana Department of
Environmental Management ("IDEM") acting as lead trustee, that IDEM and the U.S.
Department of the Interior had concluded a preliminary investigation of
potential injuries to natural resources related to the releases of hazardous
substances from various municipal and industrial sources along the east branch
of the Grand Calumet River and Indiana Harbor Canal.  The public trustees
completed a pre-assessment screen pursuant to federal regulations and have
determined to perform a Natural Resource Damages Assessment. USX was identified
as a PRP along with 15 other companies owning property along the river and
harbor canal.  USX and eight other PRPs have formed a joint defense group.  In
2000, the trustees concluded their assessment of sediment injuries, which
includes a technical review of environmental conditions.  The PRP joint defense
group has proposed terms for the settlement of this claim which have been
endorsed by representatives of the trustees and the EPA to be included in a
consent decree that USX expects will resolve this claim.  A reserve has been
established for the USX share of this anticipated settlement.

     The Berks Associates/Douglassville Site ("Berks Site") is situated on a 50-
acre parcel located on the Schuylkill River in Berks County, Pa.  Used oil and
solvent reprocessing operations were conducted on the Berks Site between 1941
and 1986.  In September 1997, USX signed a consent decree to conduct a
feasibility study at the site relating to the alternative remedy.  In 1999, a
new Record of Decision was approved by the EPA and the U.S. Department of
Justice.  On January 19, 2001, USX signed a consent decree with the EPA to
remediate this site.  On April 6, 2001, USX paid $.4 million for costs
associated with this site.  The only remaining outstanding claim is the natural
resource damages claim filed by the Commonwealth of Pennsylvania.

<PAGE> 29

                    USX CORPORATION AND SUBSIDIARY COMPANIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                  ---------------------------------------------

     USX is the subject of, or a party to, a number of pending or threatened
legal actions, contingencies and commitments involving a variety of matters,
including laws and regulations relating to the environment (see Note 14 to the
USX Consolidated Financial Statements for a discussion of certain of these
matters).  The ultimate resolution of these contingencies could, individually or
in the aggregate, be material to the USX Consolidated Financial Statements.
However, management believes that USX will remain a viable and competitive
enterprise even though it is possible that these contingencies could be resolved
unfavorably. See discussion of Liquidity herein.

Outlook
-------
     See Outlook in Management's Discussion and Analysis of Financial Condition
and Results of Operations for the Marathon Group and the U. S. Steel Group.


<PAGE> 30

                    USX CORPORATION AND SUBSIDIARY COMPANIES
                          QUANTITATIVE AND QUALITATIVE
                          DISCLOSURES ABOUT MARKET RISK
                    -----------------------------------------

Commodity Price Risk and Related Risks
--------------------------------------
     Sensitivity analysis of the incremental effects on pretax income of
hypothetical 10% and 25% changes in commodity prices for commodity-based
derivative instruments are provided in the following table(a):

<TABLE>
                                            Incremental Decrease in
                                           Income Before Income Taxes
                                            Assuming a Hypothetical
                                                Price Change of:

(Dollars in millions)                             10%     25%
---------------------------------------------------------------------------
<S>                                              <C>     <C>    <C>
Commodity-Based Derivative Instruments
Marathon Group(b)(c)
    Crude oil
       Trading(f)(g)                             $3.9    $9.8   (e)
       Other than trading(f)(g)                   0.6    22.2   (e)
    Natural gas
       Other than trading(f)(g)                  20.3    50.6   (d)
    Refined products
       Other than trading(f)(g)                   1.0     2.6   (d)

U. S. Steel Group
    Zinc
       Other than trading                         2.0     5.0   (e)
    Tin
       Other than trading                         0.3     0.7   (e)
<FN>
 (a)  Gains and losses on commodity-based derivative instruments used for
      other than trading activities are generally offset by price changes in
      the underlying commodity.  With the adoption of SFAS No. 133, the
      definition of a derivative instrument has been expanded to include
      certain fixed price physical commodity contracts.  Such instruments are
      included in the above table.  Amounts reflect the estimated incremental
      effect on pretax income of a hypothetical 10% and 25% change in closing
      commodity prices at March 31, 2001.  Management evaluates the portfolios
      of commodity-based derivative instruments on an ongoing basis and adjusts
      strategies to reflect anticipated market conditions, changes in risk
      profiles and overall business objectives.  Changes to the portfolios
      subsequent to March 31, 2001, may cause future pretax income effects to
      differ from those presented in the table.
 (b)  The number of net open contracts varied throughout first quarter
      2001, from a low of 21,416 contracts at March 31, to a high of 35,646
      contracts at February 8, and averaged 30,462 for the quarter.  The type
      of derivative instruments and number of positions entered into will vary
      which changes the composition of the portfolio.  Because of these
      variations, the number of open contracts, by itself, cannot be used to
      predict future income effects.
 (c)  The calculation of sensitivity amounts for basis swaps assumes that
      the physical and paper indices are perfectly correlated.  Gains and
      losses on options are based on changes in intrinsic value only.
 (d)  Price increase.
 (e)  Price decrease.
 (f)  The direction of the price change used in calculating the
      sensitivity amount for each commodity reflects that which would result in
      the largest incremental decrease in pretax income.
 (g)  Adjusted to reflect Marathon's 62 percent ownership of MAP.
</TABLE>


<PAGE> 31

                    USX CORPORATION AND SUBSIDIARY COMPANIES
                          QUANTITATIVE AND QUALITATIVE
                          DISCLOSURES ABOUT MARKET RISK
                    -----------------------------------------
                                        
Interest Rate Risk
------------------
     As of March 31, 2001, the discussion of USX's interest rate risk has not
changed materially from that presented in Quantitative and Qualitative
Disclosures About Market Risk included in USX's 2000 Form 10-K.

Foreign Currency Exchange Rate Risk
-----------------------------------
     USX is subject to the risk of price fluctuations related to anticipated
revenues and operating costs, firm commitments for capital expenditures and
existing assets or liabilities denominated in currencies other than U.S.
dollars.  USX has not generally used derivative instruments to manage this risk.
However, USX has made limited use of forward currency contracts to manage
exposure to certain currency price fluctuations.
     At March 31, 2001, USX had open Euro forward sale contracts for both
U.S. dollars and Slovak Koruna.  A 10% increase in the March 31, 2001 Euro
forward rates would result in an immaterial charge to income.  The entire amount
of these contracts is attributed to the U. S. Steel Group.
     At March 31, 2001, the discussion of the Marathon Group's foreign currency
exchange rate risk has not changed materially from that presented in
Quantitative and Qualitative Disclosures About Market Risk included in USX's
2000 Form 10-K.

Safe Harbor
-----------
     USX's quantitative and qualitative disclosures about market risk include
forward-looking statements with respect to management's opinion about risks
associated with USX's use of derivative instruments.  These statements are based
on certain assumptions with respect to market prices and industry supply and
demand for crude oil, natural gas, refined products, steel products and certain
raw materials. To the extent that these assumptions prove to be inaccurate,
future outcomes with respect to USX's hedging programs may differ materially
from those discussed in the forward-looking statements.

<PAGE> 32

<TABLE>
                                 USX CORPORATION
                        FINANCIAL STATISTICS (Unaudited)
                        --------------------------------


                                                     First Quarter
                                                         Ended
                                                        March 31
                                                   -----------------
(Dollars in Millions)                                2001      2000
---------------------------------------------------------------------------------
<S>                                               <C>       <C>
REVENUES AND OTHER INCOME

 Marathon Group                                    $8,735    $7,855
 U. S. Steel Group                                  1,564     1,588
 Eliminations                                         (14)      (14)
                                                  -------   -------
    Total                                         $10,285    $9,429


INCOME (LOSS) FROM OPERATIONS

 Marathon Group                                      $912      $525
 U. S. Steel Group                                   (101)       91
                                                    -----     -----
    Total                                            $811      $616


CAPITAL EXPENDITURES

 Marathon Group                                      $276      $337
 U. S. Steel Group                                     37        45
                                                    -----     -----
    Total                                            $313      $382

</TABLE>


<PAGE> 33

Part I - Financial Information (Continued):

     B.   Marathon Group

<TABLE>
<CAPTION>
                        MARATHON GROUP OF USX CORPORATION
                       STATEMENT OF OPERATIONS (Unaudited)
                       -----------------------------------
                                                  First Quarter Ended
                                                        March 31
(Dollars in millions, except per share amounts)      2001      2000
-------------------------------------------------------------------------
<S>                                                <C>       <C>
REVENUES AND OTHER INCOME:
 Revenues                                          $8,620    $7,739
 Dividend and investee income                          33        11
 Net gains on disposal of assets                       14        92
 Gain on ownership change in Marathon Ashland
  Petroleum LLC                                         1         4
 Other income                                          67         9
                                                   ------    ------
     Total revenues and other income                8,735     7,855
                                                   ------    ------
COSTS AND EXPENSES:
 Cost of revenues (excludes items shown below)      6,234     5,799
 Selling, general and administrative expenses         141       134
 Depreciation, depletion and amortization             303       246
 Taxes other than income taxes                      1,122     1,106
 Exploration expenses                                  23        45
                                                   ------    ------
     Total costs and expenses                       7,823     7,330
                                                   ------    ------
INCOME FROM OPERATIONS                                912       525
Net interest and other financial costs                 35        71
Minority interest in income of Marathon Ashland
 Petroleum LLC                                        107        55
                                                   ------    ------
INCOME BEFORE INCOME TAXES AND CUMULATIVE EFFECT OF
 CHANGE IN ACCOUNTING PRINCIPLE                       770       399
Provision for income taxes                            262       145
                                                   ------    ------
INCOME BEFORE CUMULATIVE EFFECT OF CHANGE IN
 ACCOUNTING PRINCIPLE                                 508       254
Cumulative effect of change in accounting principle    (8)        -
                                                   ------    ------
NET INCOME                                           $500      $254
                                                   ======    ======
MARATHON STOCK DATA:
 Income before cumulative effect of change in
  accounting principle                               $508      $254
  - Per share - basic and diluted                    1.65       .81
 Cumulative effect of change in accounting principle   (8)        -
  - Per share - basic and diluted                    (.03)        -
 Net income                                          $500      $254
  - Per share - basic and diluted                    1.62       .81

 Dividends paid per share                             .23       .21

 Weighted average shares, in thousands
    - Basic                                       308,753   312,128
    - Diluted                                     309,073   312,285

<FN>
Selected notes to financial statements appear on pages 36-42.
</TABLE>


<PAGE> 34

<TABLE>
<CAPTION>
                        MARATHON GROUP OF USX CORPORATION
                            BALANCE SHEET (Unaudited)
                        ---------------------------------
                                        
                                                   March 31  December 31
(Dollars in millions)                                2001      2000
--------------------------------------------------------------------------
<S>                                               <C>       <C>
ASSETS

Current assets:
 Cash and cash equivalents                           $411      $340
 Receivables, less allowance for doubtful
  accounts of $3 and $3                             2,149     2,267
 Inventories                                        2,040     1,867
 Assets held for sale                                   -       330
 Deferred income tax benefits                          60        60
 Other current assets                                  99       121
                                                   ------    ------
     Total current assets                           4,759     4,985

Investments and long-term receivables                 695       362
Property, plant and equipment, less accumulated
 depreciation, depletion and amortization of
 $9,914 and $9,691                                  9,900     9,375
Prepaid pensions                                      212       207
Other noncurrent assets                               366       303
                                                   ------    ------
     Total assets                                 $15,932   $15,232
                                                   ======    ======
LIABILITIES

Current liabilities:
 Notes payable                                       $236       $80
 Accounts payable                                   2,800     3,021
 Income taxes payable                                 113       364
 Payroll and benefits payable                         221       230
 Accrued taxes                                        418       108
 Accrued interest                                      46        61
 Long-term debt due within one year                   168       148
                                                   ------    ------
     Total current liabilities                      4,002     4,012

Long-term debt, less unamortized discount           2,073     1,937
Deferred income taxes                               1,430     1,354
Employee benefits                                     646       648
Deferred credits and other liabilities                349       412
Preferred stock of subsidiary                         184       184

Minority interest in Marathon Ashland Petroleum LLC 1,938     1,840

COMMON STOCKHOLDERS' EQUITY                         5,310     4,845
                                                   ------    ------
 Total liabilities and 
           common stockholders' equity            $15,932   $15,232
                                                   ======    ======
<FN>
Selected notes to financial statements appear on pages 36-42.
</TABLE>


<PAGE> 35

<TABLE>
<CAPTION>
                        MARATHON GROUP OF USX CORPORATION
                       STATEMENT OF CASH FLOWS (Unaudited)
                       -----------------------------------
                                        
                                        
                                                  First Quarter Ended
                                                        March 31
(Dollars in millions)                                2001      2000
-------------------------------------------------------------------------
<S>                                               <C>        <C>
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

OPERATING ACTIVITIES:
Net income                                           $500      $254
Adjustments to reconcile to net cash provided from
 operating activities:
 Cumulative effect of change in accounting principle    8         -
 Minority interest in income of Marathon Ashland
  Petroleum LLC                                       107        55
 Depreciation, depletion and amortization             303       246
 Exploratory dry well costs                             4        15
 Pensions and other postretirement benefits             6        (2)
 Deferred income taxes                               (159)        4
 Net gains on disposal of assets                      (14)      (92)
 Changes in:
     Current receivables                              146        11
     Inventories                                     (170)      (34)
     Current accounts payable and accrued expenses   (272)     (108)
 All other - net                                      119       (28)
                                                   ------    ------
     Net cash provided from operating activities      578       321
                                                   ------    ------
INVESTING ACTIVITIES:
Capital expenditures                                 (276)     (337)
Acquisition of Pennaco Energy, Inc.                  (506)        -
Disposal of assets                                     34       197
Restricted cash  - withdrawals                         16       126
                 - deposits                            (6)     (185)
All other - net                                        (6)        5
                                                   ------    ------
     Net cash used in investing activities           (744)     (194)
                                                   ------    ------
FINANCING ACTIVITIES:
Increase (decrease) in Marathon Group's portion of USX
 consolidated debt                                    313       (78)
Specifically attributed debt - borrowings             112       231
                             - repayments            (112)     (222)
Dividends paid                                        (71)      (66)
Distributions to minority shareholder of
 Marathon Ashland Petroleum LLC                        (3)        -
                                                   ------    ------
     Net cash provided from (used in) 
                      financing activities            239      (135)
                                                   ------    ------
EFFECT OF EXCHANGE RATE CHANGES ON CASH                (2)       (1)
                                                   ------    ------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS   71        (9)
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR        340       111
                                                   ------    ------
CASH AND CASH EQUIVALENTS AT END OF PERIOD           $411      $102
                                                   ======    ======
Cash used in operating activities included:
 Interest and other financial costs paid (net of
  amount capitalized)                                $(58)    $(111)
 Income taxes paid, including settlements with the
  U. S. Steel Group                                  (326)     (113)

<FN>
Selected notes to financial statements appear on pages 36-42.
</TABLE>


<PAGE> 36

                        MARATHON GROUP OF USX CORPORATION
                     SELECTED NOTES TO FINANCIAL STATEMENTS
                     --------------------------------------
                                   (Unaudited)


1.  The information furnished in these financial statements is unaudited
    but, in the opinion of management, reflects all adjustments necessary for a
    fair presentation of the results for the periods covered.  All such
    adjustments are of a normal recurring nature unless disclosed otherwise.
    These financial statements, including selected notes, have been prepared in
    accordance with the applicable rules of the Securities and Exchange
    Commission and do not include all of the information and disclosures
    required by generally accepted accounting principles for complete financial
    statements.  Certain reclassifications of prior year data have been made to
    conform to 2001 classifications.  Additional information is contained in
    the USX Annual Report on Form 10-K for the year ended December 31, 2000.

2.  The financial statements of the Marathon Group include the financial
    position, results of operations and cash flows for the businesses of
    Marathon Oil Company (Marathon) and certain other subsidiaries of USX, and
    a portion of the corporate assets and liabilities and related transactions
    which are not separately identified with ongoing operating units of USX.
    These financial statements are prepared using the amounts included in the
    USX consolidated financial statements.  Corporate amounts reflected in
    these financial statements are determined based upon methods which
    management believes to be reasonable.  The accounting policies applicable
    to the preparation of the financial statements of the Marathon Group may be
    modified or rescinded in the sole discretion of the Board of Directors of
    USX (Board), although the Board has no present intention to do so.  The
    Board may also adopt additional policies depending on the circumstances.

    Although the financial statements of the Marathon Group and the U. S.
    Steel Group separately report the assets, liabilities (including contingent
    liabilities) and stockholders' equity of USX attributed to each such Group,
    such attribution of assets, liabilities (including contingent liabilities)
    and stockholders' equity between the Marathon Group and the U. S. Steel
    Group for the purpose of preparing their respective financial statements
    does not affect legal title to such assets and responsibility for such
    liabilities.  Holders of USX-Marathon Group Common Stock (Marathon Stock)
    and USX-U. S. Steel Group Common Stock (Steel Stock) are holders of common
    stock of USX and continue to be subject to all the risks associated with an
    investment in USX and all of its businesses and liabilities.  Financial
    impacts arising from one Group that affect the overall cost of USX's
    capital could affect the results of operations and financial condition of
    the other Group.  In addition, net losses of either Group, as well as
    dividends or distributions on any class of USX Common Stock or series of
    Preferred Stock and repurchases of any class of USX Common Stock or series
    of Preferred Stock at prices in excess of par or stated value, will reduce
    the funds of USX legally available for payment of dividends on both classes
    of Common Stock.  Accordingly, the USX consolidated financial information
    should be read in connection with the Marathon Group financial information.

<PAGE> 37
                        MARATHON GROUP OF USX CORPORATION
               SELECTED NOTES TO FINANCIAL STATEMENTS (Continued)
               --------------------------------------------------
                                   (Unaudited)

2.  (Continued)

    The financial statement provision for income taxes and related tax
    payments or refunds have been reflected in the Marathon Group and the
    U. S. Steel Group financial statements in accordance with USX's tax
    allocation policy for such groups.  In general, such policy provides that
    the consolidated tax provision and related tax payments or refunds are
    allocated between the Marathon Group and the U. S. Steel Group for group
    financial statement purposes, based principally upon the financial income,
    taxable income, credits, preferences and other amounts directly related to
    the respective groups.

    The provision for income taxes for the Marathon Group is based on tax
    rates and amounts which recognize management's best estimate of current and
    deferred tax assets and liabilities.  Differences between the combined
    interim tax provisions of the Marathon and U. S. Steel Groups and USX
    consolidated are allocated to each group based on the relationship of the
    individual group provisions to the combined interim provisions.

3.  The method of calculating net income per common share for the Marathon
    Stock and Steel Stock reflects the Board's intent that the separately
    reported earnings and surplus of the Marathon Group and the U. S. Steel
    Group, as determined consistent with the USX Restated Certificate of
    Incorporation, are available for payment of dividends on the respective
    classes of stock, although legally available funds and liquidation
    preferences of these classes of stock do not necessarily correspond with
    these amounts.

    Basic net income per share is based on the weighted average number of
    common shares outstanding.

    Diluted net income per share assumes exercise of stock options,
    provided the effect is not antidilutive.

    See Note 8 of the Notes to USX Consolidated Financial Statements for
    the computation of income per share.

4.  Effective January 1, 2001, USX adopted Statement of Financial
    Accounting Standards No. 133, "Accounting for Derivative Instruments and
    Hedging Activities" (SFAS No. 133), as amended by SFAS Nos. 137 and 138.
    This Standard requires recognition of all derivatives as either assets or
    liabilities at fair value.

    The transition adjustment related to adopting SFAS No. 133 on January 1,
    2001, was recognized as a cumulative effect of change in accounting
    principle.  The unfavorable cumulative effect on net income, net of a tax
    benefit of $5 million, was $8 million.  The unfavorable cumulative effect
    on other comprehensive income (OCI), net of a tax benefit of $4 million,
    was $8 million.  The amounts reported as OCI will be reflected in net
    income when the anticipated physical transactions are consummated.

    The $8 million transition adjustment recorded in OCI at January 1,
    2001, included $42 million of net losses that were reclassified into income
    during the first quarter of 2001.  In future periods, $34 million of net
    gains will

<PAGE> 38

                        MARATHON GROUP OF USX CORPORATION
               SELECTED NOTES TO FINANCIAL STATEMENTS (Continued)
               --------------------------------------------------
                                   (Unaudited)
                                        
                                        
4.  (Continued)

    be reclassified into income relating to the OCI transition adjustment
    when the related physical transactions are completed.

5.  Included in revenues and costs and expenses for the first quarter of
    2001 and 2000 were $1,038 million and $1,039 million, respectively,
    representing excise taxes on petroleum products and merchandise.

6.  The Marathon Group's total comprehensive income was $534 million for
    the first quarter of 2001 and $252 million for the first quarter of 2000.

7.  In the first quarter 2001, Marathon acquired Pennaco Energy, Inc.
    (Pennaco), a natural gas producer.  Marathon acquired 87% of the
    outstanding stock of Pennaco through a tender offer completed on
    February 7, 2001 at $19 a share.  On March 26, 2001, Pennaco was merged 
    with a wholly owned subsidiary of Marathon.  Under the terms of the merger, 
    each share not held by Marathon was converted into the right to receive $19 
    in cash.  The total cash purchase price of Pennaco was $506 million.  The
    acquisition was accounted for under the purchase method of accounting.  The
    excess of the purchase price over the preliminary fair value of net assets
    acquired (goodwill) approximates $64 million and will be amortized over 17
    years.  First quarter results of operations include the results of Pennaco
    from February 7, 2001.

    The following unaudited pro forma data for the Marathon Group includes
    the results of operations of Pennaco giving effect to the acquisition as if
    it had been consummated at the beginning of the years presented.  The pro
    forma data is based on historical information and does not necessarily
    reflect the actual results that would have occurred nor is it necessarily
    indicative of future results of operations.

<TABLE>
                                                         First
                                                     Quarter Ended
                                                        March 31
     (In millions, except per share amounts)         2001      2000
     ---------------------------------------------------------------------
     <S>                                           <C>       <C>
     Revenues and other income                     $8,743    $7,861
     Income before cumulative effect of change in
      accounting principle                            505       244
      - Per common share - basic and diluted         1.64       .78
     Net income                                       497       244
      - Per common share - basic and diluted         1.61       .78
</TABLE>

8.  In December 2000, Marathon and Kinder Morgan Energy Partners, L.P.
    signed a definitive agreement to form a joint venture combining certain of
    their oil and gas producing activities in the U.S. Permian Basin, including
    Marathon's interest in the Yates Field.  This transaction has allowed
    Marathon to expand its interests in the Permian Basin and improve access to
    materials for use in enhanced recovery techniques in the Yates Field.  The
    joint venture, named MKM Partners L.P., commenced operations in January
    2001 and is accounted for under the equity method of accounting.

<PAGE> 39

                        MARATHON GROUP OF USX CORPORATION
               SELECTED NOTES TO FINANCIAL STATEMENTS (Continued)
               --------------------------------------------------
                                   (Unaudited)


9.  The Marathon Group's operations consist of three reportable operating
    segments: 1) Exploration and Production (E&P) - explores for and produces
    crude oil and natural gas on a worldwide basis; 2) Refining, Marketing and
    Transportation (RM&T) - refines, markets and transports crude oil and
    petroleum products, primarily in the Midwest and southeastern United States
    through Marathon Ashland Petroleum LLC (MAP); and 3) Other Energy Related
    Businesses (OERB).  OERB is an aggregation of two segments which fall below
    the quantitative reporting thresholds: 1) Natural Gas and Crude Oil
    Marketing and Transportation - markets and transports its own and third-
    party natural gas and crude oil in the United States; and 2) Power
    Generation - develops, constructs and operates independent electric power
    projects worldwide.  The results of segment operations are as follows:

<TABLE>
                                                                      Total
(In millions)                                  E&P    RM&T    OERB   Segments
-------------------------------------------------------------------------------
<S>                                         <C>     <C>     <C>      <C>
FIRST QUARTER 2001
------------------
Revenues and other income:
 Customer                                   $1,238  $6,742    $628    $8,608
 Intersegment (a)                              134       6      25       165
 Intergroup (a)                                 10       -       2        12
 Equity in earnings of unconsolidated investees 20       6       4        30
 Other                                           8      15       2        25
                                            ------  ------  ------    ------
  Total revenues and other income           $1,410  $6,769    $661    $8,840
                                            ======  ======  ======    ======
Segment income                                $600    $276      $8      $884
                                            ======  ======  ======    ======

FIRST QUARTER 2000
------------------
Revenues and other income:
 Customer                                     $952  $6,427    $350    $7,729
 Intersegment (a)                               69      20      19       108
 Intergroup (a)                                  5       -       5        10
 Equity in earnings (losses) of
   unconsolidated investees                     (1)      4       4         7
 Other                                           3      11       4        18
                                            ------  ------  ------    ------
  Total revenues and other income           $1,028  $6,462    $382    $7,872
                                            ======  ======  ======    ======
Segment income                                $309    $140     $13      $462
                                            ======  ======  ======    ======
<FN>
(a)Intersegment and intergroup sales and transfers were conducted under terms
   comparable to those with unrelated parties.
</TABLE>


<PAGE> 40

                        MARATHON GROUP OF USX CORPORATION
               SELECTED NOTES TO FINANCIAL STATEMENTS (Continued)
               --------------------------------------------------
                                   (Unaudited)
                                        

9.  (Continued)

    The following schedule reconciles segment revenues and income to amounts
    reported in the Marathon Group financial statements:

<TABLE>
                                                  First Quarter Ended
                                                        March 31
(In millions)                                        2001      2000
--------------------------------------------------------------------------------
<S>                                                <C>       <C>
Revenues and other income:
 Revenues and other income of reportable segments  $8,840    $7,872
 Items not allocated to segments:
  Gain on ownership change in MAP                       1         4
  Other (a)                                            59        87
 Elimination of intersegment revenues                (165)     (108)
                                                   ------    ------
     Total Group revenues and other income         $8,735    $7,855
                                                   ======    ======

Income:
 Income for reportable segments                      $884      $462
 Items not allocated to segments:
  Gain on ownership change in MAP                       1         4
  Administrative expenses                             (32)      (28)
  Other (a)                                            59        87
                                                   ------    ------
     Total Group income from operations              $912      $525
                                                   ======    ======
<FN>
(a)Represents in 2001, gain on offshore lease resolution with the U.S.
   Government and in 2000, gain on disposition of Angus/Stellaria.
</TABLE>


10. Inventories are carried at the lower of cost or market.  Cost of
    inventories of crude oil and refined products is determined under the last-
    in, first-out (LIFO) method.

<TABLE>
                                                     (In millions)
                                                 ----------------------
                                                  March 31  December 31
                                                     2001      2000
                                                  --------------------
    <S>                                           <C>       <C>
    Crude oil and natural gas liquids                $850      $701
    Refined products and merchandise                1,092     1,069
    Supplies and sundry items                          98        97
                                                   ------    ------
      Total                                        $2,040    $1,867
                                                   ======    ======
</TABLE>


<PAGE> 41

                        MARATHON GROUP OF USX CORPORATION
               SELECTED NOTES TO FINANCIAL STATEMENTS (Continued)
               --------------------------------------------------
                                   (Unaudited)


11. At March 31, 2001, and December 31, 2000, income taxes payable
    represents an estimated income tax payable to the U. S. Steel Group. In
    addition, included in deferred credits and other liabilities at March 31,
    2001, and December 31, 2000, respectively, are $43 million and $97 million
    of income taxes payable to the U. S. Steel Group.  These amounts have been
    determined in accordance with the tax allocation policy discussed in 
    Note 2.

12. In the first quarter of 2001, interest and other financial costs
    includes a favorable adjustment of $9 million and provision for income
    taxes includes an unfavorable adjustment of $5 million, both of which are
    related to prior years' taxes.

13. USX is the subject of, or a party to, a number of pending or
    threatened legal actions, contingencies and commitments relating to the
    Marathon Group involving a variety of matters, including laws and
    regulations relating to the environment.  Certain of these matters are
    discussed below.  The ultimate resolution of these contingencies could,
    individually or in the aggregate, be material to the Marathon Group
    financial statements.  However, management believes that USX will remain a
    viable and competitive enterprise even though it is possible that these
    contingencies could be resolved unfavorably to the Marathon Group.  See
    discussion of Liquidity in USX Consolidated Management's Discussion and
    Analysis of Financial Condition and Results of Operations.

    The Marathon Group is subject to federal, state, local and foreign
    laws and regulations relating to the environment.  These laws generally
    provide for control of pollutants released into the environment and require
    responsible parties to undertake remediation of hazardous waste disposal
    sites.  Penalties may be imposed for noncompliance.  At March 31, 2001, and
    December 31, 2000, accrued liabilities for remediation totaled $85 million
    and $75 million, respectively.  It is not presently possible to estimate
    the ultimate amount of all remediation costs that might be incurred or the
    penalties that may be imposed.  Receivables for recoverable costs from
    certain states, under programs to assist companies in cleanup efforts
    related to underground storage tanks at retail marketing outlets, were $64
    million at March 31, 2001, and $57 million at December 31, 2000.

    For a number of years, the Marathon Group has made substantial capital
    expenditures to bring existing facilities into compliance with various laws
    relating to the environment.  In the first quarter of 2001 and for the
    years 2000 and 1999, such capital expenditures totaled $8 million,
    $73 million and $46 million, respectively.  The Marathon Group anticipates
    making additional such expenditures in the future; however, the exact
    amounts and timing of such expenditures are uncertain because of the
    continuing evolution of specific regulatory requirements.

    At March 31, 2001, and December 31, 2000, accrued liabilities for
    platform abandonment and dismantlement totaled $170 million and $162
    million, respectively.


<PAGE> 42

                        MARATHON GROUP OF USX CORPORATION
               SELECTED NOTES TO FINANCIAL STATEMENTS (Continued)
               --------------------------------------------------
                                   (Unaudited)


13. (Continued)

    At March 31, 2001, the Marathon Group's pro rata share of obligations
    of LOOP LLC and various pipeline affiliates secured by throughput and
    deficiency agreements totaled $119 million.  Under the agreements, the
    Marathon Group is required to advance funds if the affiliates are unable to
    service debt.  Any such advances are prepayments of future transportation
    charges.

    The Marathon Group's contract commitments to acquire property, plant
    and equipment and long-term investments at March 31, 2001, totaled
    $585 million compared with $457 million at December 31, 2000.


<PAGE> 43

                        MARATHON GROUP OF USX CORPORATION
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                  ---------------------------------------------

     The Marathon Group includes Marathon Oil Company ("Marathon") and certain
other subsidiaries of USX Corporation ("USX"), which are engaged in worldwide
exploration and production of crude oil and natural gas; domestic refining,
marketing and transportation of petroleum products primarily through Marathon
Ashland Petroleum LLC ("MAP"), owned 62 percent by Marathon; and other energy
related businesses.  The Management's Discussion and Analysis should be read in
conjunction with the Marathon Group's Financial Statements and Notes to
Financial Statements.  The discussion of Results of Operations should be read in
conjunction with the Supplemental Statistics provided on page 55.

     On April 24, 2001, USX announced that its Board of Directors authorized
management to proceed with the necessary steps to implement a plan of
reorganization of the corporation in order to separate the energy and steel
businesses.  The plan envisions a tax-free spin-off of the steel and steel-
related businesses of USX Corporation into a freestanding, publicly traded
company to be known as United States Steel Corporation ("U. S. Steel").  Holders
of current USX-U. S. Steel Group Common Stock would become holders of United
States Steel Corporation Common Stock.  Holders of current USX-Marathon Group
Common Stock would become holders of Marathon Oil Company Common Stock.  The
plan does not contemplate a cash distribution to shareholders.  Each new company
would carry approximately the same assets and liabilities now associated with
its existing businesses, except for a value transfer of approximately $900
million from Marathon Oil Company to U. S. Steel, intended to maintain U. S.
Steel as a strong, independent company.  The form of the value transfer would be
a reallocation of USX corporate debt between the current Marathon Group and the
U. S. Steel Group.  The plan of reorganization is subject to the approval of a
majority of the outstanding shares of each class of the current USX common
stock, receipt of a favorable tax ruling from the Internal Revenue Service
("IRS") on the tax-free nature of the transaction, completion of necessary
financing arrangements, receipt of necessary regulatory and third party
consents, and board approval of definitive documentation for the transaction.
The transaction is expected to occur at year-end, subject to the absence of any
materially adverse change in business conditions for the energy and/or steel
business, delay in obtaining the IRS ruling or other unfavorable circumstances.

     Certain sections of Management's Discussion and Analysis include forward-
looking statements concerning trends or events potentially affecting the
businesses of the Marathon Group.  These statements typically contain words such
as "anticipates", "believes", "estimates", "expects", "targets", "scheduled" or
similar words indicating that future outcomes are uncertain.  In accordance with
"safe harbor" provisions of the Private Securities Litigation Reform Act of
1995, these statements are accompanied by cautionary language identifying
important factors, though not necessarily all such factors that could cause
future outcomes to differ materially from those set forth in forward-looking
statements.  For additional risk factors affecting the businesses of the
Marathon Group, see Supplementary Data - Disclosures About Forward-Looking
Statements in the USX Annual Report on Form 10-K for the year ended December 31,
2000.


<PAGE> 44

                        MARATHON GROUP OF USX CORPORATION
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                  ---------------------------------------------

Results of Operations
---------------------
     Revenues and other income for the first quarter of 2001 and 2000 are
summarized in the following table:

<TABLE>
                                                      First Quarter Ended
                                                            March 31
(Dollars in millions)                                    2001      2000
-------------------------------------------------------------------------------
<S>                                                    <C>       <C>
Exploration & production ("E&P")                       $1,410    $1,028
Refining, marketing & transportation ("RM&T")           6,769     6,462
Other energy related businesses(a)                        661       382
                                                       ------    ------
     Revenues and other income of reportable segments  $8,840    $7,872

Revenues and other income not allocated to segments:
 Gain on ownership change in MAP                            1         4
 Other(b)                                                  59        87
Elimination of intersegment revenues                     (165)     (108)
                                                       ------    ------
     Total Group revenues and other income             $8,735    $7,855
                                                       ======    ======

Items included in both revenues and costs and expenses, resulting in no effect
on income:

Consumer excise taxes on petroleum
 products and merchandise                              $1,038    $1,039
Matching crude oil and refined product
 buy/sell transactions settled in cash:
   E&P                                                   $106      $155
   RM&T                                                   993       812
                                                       ------     -----
     Total buy/sell transactions                       $1,099      $967
--------
<FN>
(a) Includes domestic natural gas and crude oil marketing and transportation,
    and power generation.
(b) Represents in 2001, a gain on an offshore lease resolution with the U.S.
    Government and in 2000, a gain on the disposition of Angus/Stellaria.
</TABLE>

     E&P segment revenues increased by $382 million in the first quarter of 2001
from the comparable prior-year period.  The increase primarily reflected higher
worldwide natural gas prices and higher international liquid hydrocarbon
volumes.

     RM&T segment revenues increased by $307 million in the first quarter of
2001 from the comparable prior-year period.  The increase primarily reflected
higher refined product prices and increased refined product sales volumes.

     Other energy related businesses segment revenues increased by $279 million
in the first quarter of 2001 from the comparable prior-year period.  The
increase primarily reflected higher natural gas and crude oil resale activity
accompanied by higher natural gas prices.

<PAGE> 45

                        MARATHON GROUP OF USX CORPORATION
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                  ---------------------------------------------

     Income from operations for the first quarter of 2001 and 2000 is summarized
in the following table:

<TABLE>
                                                       First Quarter Ended
                                                             March 31
(Dollars in millions)                                     2001      2000
-------------------------------------------------------------------------------
<S>                                                       <C>       <C>
E&P
  Domestic                                                $442      $201
  International                                            158       108
                                                          ----      ----
    Income of E&P reportable segment                       600       309
RM&T                                                       276       140
Other energy related businesses                              8        13
                                                          ----      ----
      Income for reportable segments                      $884      $462

Items not allocated to reportable segments:
   Administrative expenses(a)                              (32)      (28)
   Gain on offshore lease resolution with U.S. Government   59         -
   Gain on disposition of Angus/Stellaria(b)                 -        87
   Gain on ownership change - MAP                            1         4
                                                          ----      ----
      Total income from operations                        $912      $525
--------
<FN>
(a) Includes the portion of the Marathon Group's administrative costs not
    charged to the operating segments and the portion of USX corporate general
    and administrative costs allocated to the Marathon Group.
(b) Resulted from the disposition of Marathon's 33.34 percent interest in the
    Angus/Stellaria development located in the Gulf of Mexico.
</TABLE>

     Income for reportable segments in the first quarter of 2001 increased by
$422 million from last year's first quarter, due primarily to higher worldwide
natural gas prices, higher worldwide liquid hydrocarbon volumes and higher
refined product margins, partially offset by lower worldwide liquid hydrocarbon
prices.

     Worldwide E&P segment income in the first quarter of 2001 increased by $291
million from last year's first quarter, primarily due to the factors discussed
below.

     Domestic E&P income in the first quarter of 2001 increased by $241 million
from last year's first quarter.  This increase was mainly due to higher natural
gas prices and liquid hydrocarbon volumes, partially offset by decreased liquid
hydrocarbon prices.

     International E&P income in the first quarter of 2001 increased by $50
million from last year's first quarter.  This increase was mainly due to higher
natural gas prices and higher liquid hydrocarbon volumes resulting from
increased production from properties received in the Sakhalin Energy exchange,
partially offset by a decrease in natural gas volumes resulting from lower
production in Ireland and Canada.

<PAGE> 46

                        MARATHON GROUP OF USX CORPORATION
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                  ---------------------------------------------

     RM&T segment income in the first quarter of 2001 increased by $136 million
from last year's first quarter.  The increase in downstream segment income was
primarily due to a higher refining and wholesale marketing refined product
margin, partially offset by a decrease in the retail gasoline and distillate
gross margin and higher operating and administrative expenses including costs
related to MAP's variable pay plan.

     Other energy related businesses segment income in the first quarter of 2001
decreased by $5 million from last year's first quarter.  This decrease was
primarily due to derivative instrument valuation.
     
     Net interest and other financial costs were $35 million in the first
quarter of 2001, compared with $71 million in the first quarter of 2000.  In
the first quarter of 2001, interest and other financial costs includes a
favorable adjustment of $9 million related to prior year taxes.  Excluding this
adjustment, the decrease of $27 million was primarily due to lower average debt
levels.
     
     The minority interest in income of MAP, which represents Ashland's 38
percent ownership interest, increased by $52 million in the first quarter of
2001 from the comparable 2000 period, due to higher RM&T segment income as
discussed above.

     The provision for income taxes in the first quarter of 2001 increased by
$117 million from last year's first quarter primarily due to an increase in
income before income taxes.  In the first quarter of 2001, the provision for
income taxes includes an unfavorable adjustment of $5 million related to prior
years' taxes.

     The cumulative effect of change in accounting principle of $8 million, net
of a tax benefit of $5 million, in the first quarter of 2001 was an unfavorable
transition adjustment related to adopting SFAS No. 133.  For further discussion,
see Note 4 to the Marathon Group Financial Statements.

     Net income for the first quarter increased by $246 million in 2001 from
2000, primarily reflecting the factors discussed above.

Cash Flows
----------
     Net cash provided from operating activities was $578 million in the first
quarter of 2001, compared with $321 million in the first quarter of 2000.  The
$257 million increase mainly reflected the favorable effects of improved net
income (excluding noncash items) and net favorable working capital changes,
excluding the intergroup tax payment to the U. S. Steel Group made in accordance
with the group tax allocation policy.  This payment was $364 million in the
first quarter of 2001 compared to $97 million in the first quarter of 2000.  For
additional information on the group tax allocation policy, see Note 2 to the
Marathon Group Financial Statements.

     Capital expenditures in the first quarter of 2001 totaled $276 million,
compared with $337 million in the first quarter of 2000.  The $61 million
decrease mainly reflected reduced spending in the first quarter of 2001 on 
domestic production property acquisitions.  For additional information 
regarding capital expenditures, refer to the Supplemental Statistics on 
page 55.

<PAGE> 47

                        MARATHON GROUP OF USX CORPORATION
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                  ---------------------------------------------

     The acquisition of Pennaco Energy, Inc. ("Pennaco") included cash payments
of $506 million.  For further discussion of Pennaco, see Note 7 to the Marathon
Group Financial Statements.

     Cash from disposal of assets was $34 million in the first quarter of 2001,
compared with $197 million in the first quarter of 2000.  Proceeds in 2001 were
mainly from the sale of various Canadian oil fields, various domestic producing
properties and Speedway SuperAmerica LLC ("SSA") stores.  Proceeds in 2000 were
mainly from the disposition of Marathon's 33.34 percent interest in the
Angus/Stellaria development in the Gulf of Mexico.

     The net change in restricted cash was a net withdrawal of $10 million in
the first quarter of 2001, compared to a net deposit of $59 million in the first
quarter of 2000.  Restricted cash in both periods primarily reflected the net
effects of cash deposited and withdrawn from domestic production property
dispositions and acquisitions.

     Contract commitments for property, plant and equipment acquisitions and
long-term investments at March 31, 2001, totaled $585 million compared with $457
million at December 31, 2000.

     Financial obligations, which consist of the Marathon Group's portion of USX
debt and preferred stock of a subsidiary attributed to both groups, as well as
debt specifically attributed to the Marathon Group, increased by $313 million in
the first quarter of 2001.  Financial obligations increased primarily because
the acquisition of Pennaco, capital expenditures and dividends paid exceeded
cash from operating activities and asset sales.  For further details, see
Management's Discussion and Analysis of USX Consolidated Financial Condition,
Cash Flows and Liquidity.

Derivative Instruments
----------------------
     See Quantitative and Qualitative Disclosure About Market Risk for
discussion of derivative instruments and associated market risk for the Marathon
Group.

Liquidity
---------
     For discussion of USX's liquidity and capital resources, see Management's
Discussion and Analysis of USX Consolidated Financial Condition, Cash Flows and
Liquidity.

<PAGE> 48
                                        
                        MARATHON GROUP OF USX CORPORATION
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                  ---------------------------------------------

Environmental Matters, Contingencies and Commitments
----------------------------------------------------
     The Marathon Group has incurred and will continue to incur substantial
capital, operating and maintenance, and remediation expenditures as a result of
environmental laws and regulations.  To the extent these expenditures, as with
all costs, are not ultimately reflected in the prices of the Marathon Group's
products and services, operating results will be adversely affected.  The
Marathon Group believes that substantially all of its competitors are subject to
similar environmental laws and regulations.  However, the specific impact on
each competitor may vary depending on a number of factors, including the age and
location of its operating facilities, marketing areas, production processes and
whether or not it is engaged in the petrochemical business, power business or
the marine transportation of crude oil and refined products.

     USX has been notified that it is a potentially responsible party ("PRP") at
11 waste sites related to the Marathon Group under the Comprehensive
Environmental Response, Compensation and Liability Act ("CERCLA") as of
March 31, 2001.  In addition, there are 5 sites related to the Marathon Group 
where USX has received information requests or other indications that USX may 
be a PRP under CERCLA but where sufficient information is not presently 
available to confirm the existence of liability.
     
     There are also 114 additional sites, excluding retail marketing outlets,
related to the Marathon Group where remediation is being sought under other
environmental statutes, both federal and state, or where private parties are
seeking remediation through discussions or litigation.  Of these sites, 14 were
associated with properties conveyed to MAP by Ashland for which Ashland has
retained liability for all costs associated with remediation.
     
     At many of these sites, USX is one of a number of parties involved and the
total cost of remediation, as well as USX's share thereof, is frequently
dependent upon the outcome of investigations and remedial studies.  The Marathon
Group accrues for environmental remediation activities when the responsibility
to remediate is probable and the amount of associated costs is reasonably
determinable.  As environmental remediation matters proceed toward ultimate
resolution or as additional remediation obligations arise, charges in excess of
those previously accrued may be required.
     
     New Tier II gasoline rules, which were finalized by the U.S. Environmental
Protection Agency ("EPA") in February 2000, and the diesel fuel rule which was
finalized in January 2001, require substantially reduced sulfur levels.  The
combined capital cost to achieve compliance with the gasoline and diesel
regulations could amount to approximately $700 million between 2003 and 2005.
This is a forward-looking statement and can only be a broad-based estimate due
to the ongoing evolution of regulatory requirements.  Some factors (among
others) that could potentially affect gasoline and diesel fuel compliance costs
include obtaining the necessary construction and environmental permits,
operating and logistical considerations, and unforeseen hazards such as weather
conditions.

<PAGE> 49
                                        
                        MARATHON GROUP OF USX CORPORATION
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                  ---------------------------------------------

     In October 1998, the National Enforcement Investigations Center and Region
V of the EPA conducted a multi-media inspection of MAP's Detroit refinery.
Subsequently, in November 1998, Region V conducted a multi-media inspection of
MAP's Robinson refinery.  These inspections covered compliance with the Clean
Air Act (New Source Performance Standards, Prevention of Significant
Deterioration, and the National Emission Standards for Hazardous Air Pollutants
for Benzene), the Clean Water Act (permit exceedances for the Waste Water
Treatment Plant), reporting obligations under the Emergency Planning and
Community Right to Know Act and the handling of process waste.  MAP has been
served with two Notices of Violation ("NOV") and three Findings of Violation in
connection with the multi-media inspections at its Detroit refinery.  The
Detroit notices allege violations of the Michigan State Air Pollution
Regulations, the EPA New Source Performance Standards and National Emission
Standards for Hazardous Air Pollutants for Benzene.  On March 6, 2000, MAP
received its first NOV arising out of the multi-media inspection of the Robinson
Refinery conducted in November 1998.  The NOV is for alleged Resource
Conservation and Recovery Act (hazardous waste) violations.
     
     MAP has recently settled with the EPA certain New Source Review ("NSR")
compliance issues as well as multi-media issues related to the EPA's 1998 
multi-media inspections of the Detroit and Robinson refineries.  MAP's
settlement with the EPA includes all of MAP's refineries and commits MAP to 
specific control technologies and implementation schedules for approximately 
$263 million in environmental capital expenditures and improvements to MAP's 
refineries over approximately an 8 year period that are consistent with MAP's 
current capital spending plans.  It also commits MAP to payment of an aggregate
civil penalty in the amount of $3.8 million and the performance of $6.5 million 
in supplemental environmental projects as a part of an enforcement action for
alleged Clean Air Act violations.  MAP believes that the settlement will 
provide MAP with increased permitting and operating flexibility while achieving
significant emission reductions.
     
     USX is the subject of, or a party to, a number of pending or threatened
legal actions, contingencies and commitments relating to the Marathon Group
involving a variety of matters, including laws and regulations relating to the
environment.  See Note 13 to the Marathon Group Financial Statements for a
discussion of certain of these matters.  The ultimate resolution of these
contingencies could, individually or in the aggregate, be material to the
Marathon Group Financial Statements.  However, management believes that USX will
remain a viable and competitive enterprise even though it is possible that these
contingencies could be resolved unfavorably to the Marathon Group.  See
Management's Discussion and Analysis of USX Consolidated Financial Condition,
Cash Flows and Liquidity.

<PAGE> 50
                                        
                        MARATHON GROUP OF USX CORPORATION
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                  ---------------------------------------------

Outlook
-------
     The outlook regarding the Marathon Group's upstream revenues and income is
largely dependent upon future prices and volumes of liquid hydrocarbons and
natural gas.  Prices have historically been volatile and have frequently been
affected by unpredictable changes in supply and demand resulting from
fluctuations in worldwide economic activity and political developments in the
world's major oil and gas producing and consuming areas.  Any significant
decline in prices could have a material adverse effect on the Marathon Group's
results of operations.  A prolonged decline in such prices could also adversely
affect the quantity of crude oil and natural gas reserves that can be
economically produced and the amount of capital available for exploration and
development.

     In second quarter 2001, worldwide production is expected to be
approximately 400 to 405 thousand barrels of oil equivalent ("BOE") per day.
For the year, worldwide production is expected to average between 425 and 430 
thousand BOE per day, split evenly between liquid hydrocarbons and natural gas, 
including production from Marathon's share of investees and future acquisitions.

     On February 7, 2001, Marathon acquired 87% of the outstanding stock of
Pennaco through a tender offer.  The merger was completed on March 26, 2001,
after approval by Pennaco shareholders.  Results of operations for the first
quarter include the results of Pennaco from February 7, 2001.  Pennaco's current
net production is over 45 million cubic feet of natural gas per day.

     Marathon plans to drill three deepwater Gulf of Mexico exploratory wells in
2001.  To support this increased drilling activity, Marathon has contracted two
new deepwater rigs, capable of drilling in water depths beyond 6,500 feet.  In
addition, Marathon will drill a well on its Southhampton prospect in the
Atlantic Ocean off the Nova Scotian coast in the fourth quarter and will
participate in a well on Block 31 offshore Angola.

     On May 1, 2001, the cash related to the recorded gain on the offshore lease
resolution with the U.S. Government was received in the amount of $78 million.

     The above discussion includes forward-looking statements with respect to
the expected levels of Marathon's worldwide liquid hydrocarbon and natural gas
production and the drilling program.  Some factors that could potentially affect
worldwide liquid hydrocarbon and natural gas production include pricing, supply
and demand for petroleum products, amount of capital available for exploration
and development, regulatory constraints, timing of commencing production from
new wells, and other geological, operating and economic considerations.  Some
factors that affect the drilling program include the timing and results of
future development drilling and drilling rig availability.

<PAGE> 51
                                        
                        MARATHON GROUP OF USX CORPORATION
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                  ---------------------------------------------

     Downstream income of the Marathon Group is largely dependent upon the
refining and wholesale marketing margin for refined products and the retail
gross margin for gasoline and distillates.  The refining and wholesale marketing
margin reflects the difference between the wholesale selling prices of refined
products and the cost of raw materials refined, purchased product costs and
manufacturing expenses.  Refining and wholesale marketing margins have been
historically volatile and vary with the level of economic activity in the
various marketing areas, the regulatory climate, the seasonal pattern of certain
product sales, crude oil costs, manufacturing costs, the available supply of
crude oil and refined products, and logistical constraints.  The retail gross
margin for gasoline and distillates reflects the difference between the retail
selling prices of these products and their wholesale cost.  Retail gasoline and
distillate margins have also been historically volatile, but tend to be counter
cyclical to the refining and wholesale marketing margin.  Factors affecting the
retail gasoline and distillate margin include seasonal demand fluctuations, the
available wholesale supply, the level of economic activity in the marketing
areas and weather situations which impact driving conditions.

     In 2000, MAP, Panhandle Eastern Pipe Line Company, a subsidiary of CMS
Energy Corporation, and TE Products Pipe Line Company, Limited Partnership
("TEPPCO"), formed a limited liability company with equal ownership called
Centennial Pipeline LLC to operate an interstate refined petroleum products
pipeline extending from the U.S. Gulf of Mexico to the Midwest.  The new company
plans to build a 74-mile, 24-inch diameter pipeline connecting TEPPCO's facility
in Beaumont, Texas, with an existing 720-mile, 26-inch diameter pipeline
extending from Longville, Louisiana to Bourbon, Illinois.  A significant
milestone in the project was reached on March 29, 2001, when the Federal Energy
Regulatory Commission ("FERC") approved the abandonment of the 720-mile pipeline
from natural gas service thus allowing conversion to refined products
transportation.  As part of the project, a two million barrel terminal storage
facility will be constructed.  The Centennial Pipeline system will connect with
existing MAP transportation assets and other common carrier lines and is
expected to be operational in first quarter 2002.

     MAP and Pilot Corporation announced in March 2001 that they have signed a
letter of intent to pursue a combination of the travel center operations of
MAP's wholly owned subsidiary, SSA, and Pilot.  Under its terms, MAP and Pilot
would each have a 50 percent interest in the new company that would comprise a
nationwide chain of about 250 Travel Centers, consisting of 110 SSA Travel
Centers in 18 states and 140 Pilot Travel Centers in 39 states.  This
combination represents a step forward in MAP's plans to expand to a national
truck stop network.  The companies anticipate closing the transaction this
summer, pending completion of due diligence and the execution of definitive
agreements.
     
     MAP also announced in March 2001 an agreement with Welsh Inc. to purchase
all of its convenience stores located in Indiana and Michigan.  Welsh is
recognized as a leader in developing convenience store formats with car washes
and quick-service restaurants.  The transaction is expected to close in the
second quarter 2001.
     
     In connection with the plan of reorganization described on page 43,
Standard & Poor's reported that they had assigned a BBB+ corporate credit rating
to Marathon Oil Company with a stable outlook assuming the reorganization plan
is completed.

<PAGE> 52
                                        
                        MARATHON GROUP OF USX CORPORATION
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                  ---------------------------------------------

     The above discussion includes forward-looking statements with respect to
the expected completion of construction and commencement of operation of
Centennial Pipeline, the expected successful completion and timing of the two
proposed retail marketing transactions, and the plan of reorganization.  Some
factors which impact the Centennial Pipeline project include obtaining the
necessary construction and environmental permits, unforeseen hazards such as
weather conditions, obtaining the necessary rights-of-way, and regulatory
approval constraints.  Some factors which affect the successful completion of
the two proposed retail marketing transactions are the execution and closing of
definitive agreements, and the receipt of government and third party approvals.
Some factors which will affect the plan of reorganization include approval of a
majority of the outstanding shares of each class of the current USX common
stock, receipt of a favorable tax ruling from the IRS on the tax-free nature of
the transaction, completion of necessary financing arrangements, receipt of
necessary regulatory and third party consents, any materially adverse changes in
business conditions for the energy and/or steel businesses, board approval of
definitive documentation of the transaction or other unfavorable circumstances.
These factors (among others) could cause actual results to differ materially
from those set forth in the forward-looking statements.

<PAGE> 53

                        MARATHON GROUP OF USX CORPORATION
                          QUANTITATIVE AND QUALITATIVE
                          DISCLOSURES ABOUT MARKET RISK
                          -----------------------------

Commodity Price Risk and Related Risks
--------------------------------------
     Sensitivity analysis of the incremental effects on pretax income of
hypothetical 10% and 25% changes in commodity prices for commodity-based
derivative instruments are provided in the following table(a):

<TABLE>
                                            Incremental Decrease in
                                           Income Before Income Taxes
                                            Assuming a Hypothetical
                                                Price Change of:

(Dollars in millions)                             10%     25%
---------------------------------------------------------------------------
<S>                                              <C>     <C>    <C>
Commodity-Based Derivative Instruments
Marathon Group(b)(c)
    Crude oil
       Trading(f)(g)                             $3.9    $9.8   (e)
       Other than trading(f)(g)                   0.6    22.2   (e)
    Natural gas
       Other than trading(f)(g)                  20.3    50.6   (d)
    Refined products
       Other than trading(f)(g)                   1.0     2.6   (d)
<FN>
 (a)  Gains and losses on commodity-based derivative instruments used for
      other than trading activities are generally offset by price changes in
      the underlying commodity.  With the adoption of SFAS No. 133, the
      definition of a derivative instrument has been expanded to include
      certain fixed price physical commodity contracts.  Such instruments are
      included in the above table.  Amounts reflect the estimated incremental
      effect on pretax income of a hypothetical 10% and 25% change in closing
      commodity prices at March 31, 2001.  Management evaluates its portfolio
      of commodity-based derivative instruments on an ongoing basis and adjusts
      strategies to reflect anticipated market conditions, changes in risk
      profiles and overall business objectives.  Changes to the portfolios
      subsequent to March 31, 2001, may cause future pretax income effects to
      differ from those presented in the table.
 (b)  The number of net open contracts varied throughout first quarter
      2001, from a low of 21,416 contracts at March 31, to a high of 35,646
      contracts at February 8, and averaged 30,462 for the quarter.  The type
      of derivative instruments and number of positions entered into will vary
      which changes the composition of the portfolio.  Because of these
      variations, the number of open contracts, by itself, cannot be used to
      predict future income effects.
 (c)  The calculation of sensitivity amounts for basis swaps assumes that
      the physical and paper indices are perfectly correlated.  Gains and
      losses on options are based on changes in intrinsic value only.
 (d)  Price increase.
 (e)  Price decrease.
 (f)  The direction of the price change used in calculating the
      sensitivity amount for each commodity reflects that which would result in
      the largest incremental decrease in pretax income.
 (g)  Adjusted to reflect Marathon's 62 percent ownership of MAP.
</TABLE>


<PAGE> 54

                        MARATHON GROUP OF USX CORPORATION
                          QUANTITATIVE AND QUALITATIVE
                          DISCLOSURES ABOUT MARKET RISK
                        ---------------------------------

Interest Rate Risk
------------------
     As of March 31, 2001, the discussion of the Marathon Group's interest rate
risk has not changed materially from that presented in Quantitative and
Qualitative Disclosures About Market Risk included in USX's 2000 Form 10-K.

Foreign Currency Exchange Rate Risk
-----------------------------------
     As of March 31, 2001, the discussion of the Marathon Group's foreign
currency exchange rate risk has not changed materially from that presented in
Quantitative and Qualitative Disclosures About Market Risk included in USX's
2000 Form 10-K.

Safe Harbor
-----------
     The Marathon Group's quantitative and qualitative disclosures about market
risk include forward-looking statements with respect to management's opinion
about risks associated with the Marathon Group's use of derivative instruments.
These statements are based on certain assumptions with respect to market prices
and industry supply and demand for crude oil, natural gas, and refined products.
To the extent that these assumptions prove to be inaccurate, future outcomes
with respect to the Marathon Group's hedging programs may differ materially from
those discussed in the forward-looking statements.


<PAGE> 55

<TABLE>
<CAPTION>                                        
                        MARATHON GROUP OF USX CORPORATION
                       SUPPLEMENTAL STATISTICS (Unaudited)
                       -----------------------------------

                                                      First Quarter
                                                      Ended March 31
(Dollars in millions)                                 2001     2000
---------------------------------------------------------------------
<S>                                                  <C>       <C>
INCOME (LOSS) FROM OPERATIONS
 Exploration & Production ("E&P")
    Domestic                                         $442      $201
    International                                     158       108
                                                    -----     -----
      Income For E&P Reportable Segment               600       309
 Refining, Marketing & Transportation                 276       140
 Other Energy Related Businesses(a)                     8        13
                                                    -----     -----
        Income For Reportable Segments               $884      $462

 Items Not Allocated To Reportable Segments:
   Administrative Expenses                            (32)      (28)
   Gain on disposition of Angus/Stellaria               -        87
   Gain on lease resolution with U.S. Government       59         -
   Gain on Ownership Change - MAP                       1         4
                                                    -----     -----
      Marathon Group Income From Operations          $912      $525

CAPITAL EXPENDITURES
 Exploration & Production                            $157      $271
 Refining, Marketing & Transportation                  97        60
 Other(b)                                              22         6
                                                    -----     -----
      Total                                          $276      $337

EXPLORATION EXPENSE
 Domestic                                             $13       $31
 International                                         10        14
                                                    -----     -----
      Total                                           $23       $45


OPERATING STATISTICS

Net Liquid Hydrocarbon Production(c):
    United States                                   124.4     128.7
    Europe                                           53.9      29.4
    Other International                              34.3      36.2
                                                    -----     -----
      Total Consolidated                            212.6     194.3
    Equity Investee (MKM Partners L.P.)              10.3         -
                                                    -----     -----
      Worldwide                                     222.9     194.3

Net Natural Gas Production(d):
    United States                                   789.0     751.4
    Europe(e)                                       345.6     361.5
    Other International                             130.0     135.0
                                                  -------   -------
      Total Consolidated                          1,264.6   1,247.9
    Equity Investee (CLAM)                           34.6      36.8
                                                  -------   -------
      Worldwide                                   1,299.2   1,284.7

Average Sales Prices(f)(g):
 Liquid Hydrocarbons (per Bbl)
    Domestic                                       $23.38    $24.12
    International                                   24.73     25.85
 Natural Gas (per Mcf)
    Domestic                                        $5.50     $2.18
    International                                    3.83      2.42
</TABLE>


<PAGE> 56

<TABLE>
<CAPTION>                                        
                        MARATHON GROUP OF USX CORPORATION
                       SUPPLEMENTAL STATISTICS (Unaudited)
                       -----------------------------------

                                                     First Quarter
                                                     Ended March 31
                                                     2001      2000
                                                 --------------------

OPERATING STATISTICS (continued)
<S>                                              <C>        <C>
MAP:

Crude Oil Refined (c)                               869.9     851.4

Consolidated Refined Products Sold (c)(k)         1,253.0   1,218.6

  Matching buy/sell volumes included in refined
  products sold (c)                                  53.4      49.0

Refining and Wholesale Marketing Margin (h)(i)    $0.0865   $0.0438

Number of SSA retail outlets                        2,183     2,420

SSA Gasoline and Distillate Sales (j)               1,054     1,113

SSA Gasoline and Distillate Gross Margin(h)       $0.0958   $0.1079

SSA Merchandise Sales                                $528      $533

SSA Merchandise Gross Margin                         $129      $129

------------
<FN>
 (a)  Includes domestic natural gas and crude oil marketing and
      transportation, and power generation.
 (b)  Includes other energy related businesses and corporate capital
      expenditures.
 (c)  Thousands of barrels per day
 (d)  Millions of cubic feet per day
 (e)  Includes gas acquired for injection and subsequent resale of 9.1 and
      13.9 mmcfd in the first quarters of 2001 and 2000, respectively.
 (f)  Prices exclude gains and losses from hedging activities.
 (g)  Prices exclude equity investees and purchase/resale gas.
 (h)  Per gallon
 (i)  Sales revenue less cost of refinery inputs, purchased products and
      manufacturing expenses, including depreciation.
 (j)  Millions of gallons
 (k)  Total volume of all refined product sales to MAP's wholesale,
      branded and retail (SSA) customers.
</TABLE>



<PAGE> 57

Part I - Financial Information (Continued):

     C.   U. S. Steel Group

<TABLE>
<CAPTION>
                      U. S. STEEL GROUP OF USX CORPORATION
                       STATEMENT OF OPERATIONS (Unaudited)
                      ------------------------------------
                                        
                                                  First Quarter Ended
                                                        March 31
(Dollars in millions, except per share amounts)      2001      2000
------------------------------------------------------------------------
<S>                                                <C>       <C>
REVENUES AND OTHER INCOME:
 Revenues                                          $1,510    $1,582
 Income (loss) from investees                          47        (7)
 Net gains on disposal of assets                        6        15
 Other income (loss)                                    1        (2)
                                                   ------    ------
     Total revenues and other income                1,564     1,588
                                                   ------    ------
COSTS AND EXPENSES:
 Cost of revenues (excludes items shown below)      1,549     1,428
 Selling, general and administrative expenses
                                      (credits)       (16)      (63)
 Depreciation, depletion and amortization              73        75
 Taxes other than income taxes                         59        57
                                                   ------    ------
     Total costs and expenses                       1,665     1,497
                                                   ------    ------
INCOME (LOSS) FROM OPERATIONS                        (101)       91
Net interest and other financial costs (income)       (12)       24
                                                   ------    ------
INCOME (LOSS) BEFORE INCOME TAXES                     (89)       67
Provision (credit) for income taxes                   (98)       24
                                                   ------    ------
NET INCOME                                              9        43
Dividends on preferred stock                            2         2
                                                   ------    ------
NET INCOME APPLICABLE TO STEEL STOCK                   $7       $41
                                                   ======    ======
STEEL STOCK DATA:
 Net income                                            $7       $41
    - Per share - basic and diluted                   .08       .45

 Dividends paid per share                             .25       .25

 Weighted average shares, in thousands
    - Basic                                        88,806    88,422
    - Diluted                                      88,806    88,430



<FN>
Selected notes to financial statements appear on pages 60-65.
</TABLE>


<PAGE> 58

<TABLE>
<CAPTION>
                      U. S. STEEL GROUP OF USX CORPORATION
                            BALANCE SHEET (Unaudited)
                      ------------------------------------
                                        
                                                   March 31  December 31
(Dollars in millions)                                2001      2000
------------------------------------------------------------------------
<S>                                                <C>       <C>
ASSETS

Current assets:
 Cash and cash equivalents                           $180      $219
 Receivables, less allowance for doubtful
  accounts of $130 and $57                            626       627
 Receivables subject to a security interest           350       350
 Income taxes receivable                              113       364
 Inventories                                          957       946
 Deferred income tax benefits                         170       201
 Other current assets                                  23        10
                                                   ------    ------
     Total current assets                           2,419     2,717

Investments and long-term receivables,
 less reserves of $26 and $28                         382       536
Property, plant and equipment, less accumulated
 depreciation, depletion and amortization of
 $6,570 and $6,531                                  3,067     2,739
Prepaid pensions                                    2,674     2,672
Other noncurrent assets                                84        47
                                                   ------    ------
     Total assets                                  $8,626    $8,711
                                                   ======    ======
LIABILITIES

Current liabilities:
 Notes payable                                       $164       $70
 Accounts payable                                     822       760
 Payroll and benefits payable                         234       202
 Accrued taxes                                        146       173
 Accrued interest                                      28        47
 Long-term debt due within one year                   133       139
                                                   ------    ------
     Total current liabilities                      1,527     1,391

Long-term debt, less unamortized discount           1,939     2,236
Deferred income taxes                                 627       666
Employee benefits                                   1,897     1,767
Deferred credits and other liabilities                486       483
Preferred stock of subsidiary                          66        66
USX obligated mandatorily redeemable convertible preferred
 securities of a subsidiary trust holding solely junior
 subordinated convertible debentures of USX           183       183

STOCKHOLDERS' EQUITY
Preferred stock                                         2         2
Common stockholders' equity                         1,899     1,917
                                                   ------    ------
     Total stockholders' equity                     1,901     1,919
                                                   ------    ------
     Total liabilities and stockholders' equity    $8,626    $8,711
                                                   ======    ======
<FN>
Selected notes to financial statements appear on pages 60-65.
</TABLE>


<PAGE> 59

<TABLE>
<CAPTION>
                      U. S. STEEL GROUP OF USX CORPORATION
                       STATEMENT OF CASH FLOWS (Unaudited)
                      ------------------------------------
                                                  First Quarter Ended
                                                        March 31
(Dollars in millions)                                2001      2000
-----------------------------------------------------------------------
<S>                                                <C>      <C>
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

OPERATING ACTIVITIES:
Net income                                             $9       $43
Adjustments to reconcile to net cash provided
 from operating activities:
 Depreciation, depletion and amortization              73        75
 Pensions and other postretirement benefits           (27)      (75)
 Deferred income taxes                                (20)       69
 Net gains on disposal of assets                       (6)      (15)
 Changes in:
     Current receivables                              296        13
     Inventories                                       16       (15)
     Current accounts payable and accrued expenses    (25)      (56)
 All other - net                                      (80)       (3)
                                                   ------    ------
     Net cash provided from operating activities      236        36
                                                   ------    ------
INVESTING ACTIVITIES:
Capital expenditures                                  (37)      (45)
Disposal of assets                                      3        13
Restricted cash - withdrawals                           3         1
                - deposits                              -        (1)
All other - net                                         7       (10)
                                                   ------    ------
     Net cash used in investing activities            (24)      (42)
                                                   ------    ------
FINANCING ACTIVITIES:
Increase (decrease) in U. S. Steel Group's portion of USX
 consolidated debt                                   (225)       26
Specifically attributed debt repayments                (1)       (2)
Preferred stock repurchased                             -       (11)
Dividends paid                                        (24)      (24)
                                                   ------    ------
     Net cash used in financing activities           (250)      (11)
                                                   ------    ------
EFFECT OF EXCHANGE RATE CHANGES ON CASH                (1)        -
                                                   ------    ------
NET DECREASE IN CASH AND CASH EQUIVALENTS             (39)      (17)
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR        219        22
                                                   ------    ------
CASH AND CASH EQUIVALENTS AT END OF PERIOD           $180        $5
                                                   ======    ======
Cash provided from (used in) operating activities included:
 Interest and other financial costs paid (net of
  amount capitalized)                                $(69)     $(25)
 Income taxes refunded, including settlements
  with the Marathon Group                             373        94

<FN>
Selected notes to financial statements appear on pages 60-65.
</TABLE>


<PAGE> 60

                      U. S. STEEL GROUP OF USX CORPORATION
                     SELECTED NOTES TO FINANCIAL STATEMENTS
                     --------------------------------------
                                   (Unaudited)
                                        
                                        
1.  The information furnished in these financial statements is unaudited
    but, in the opinion of management, reflects all adjustments necessary for a
    fair presentation of the results for the periods covered.  All such
    adjustments are of a normal recurring nature unless disclosed otherwise.
    These financial statements, including selected notes, have been prepared in
    accordance with the applicable rules of the Securities and Exchange
    Commission and do not include all of the information and disclosures
    required by generally accepted accounting principles for complete financial
    statements.  Certain reclassifications of prior year data have been made to
    conform to 2001 classifications.  Additional information is contained in
    the USX Annual Report on Form 10-K for the year ended December 31, 2000.

    Effective January 1, 2001, USX adopted Statement of Financial
    Accounting Standards No. 133, "Accounting for Derivative Instruments and
    Hedging Activities" (SFAS No. 133), as amended by SFAS Nos. 137 and 138.
    This Standard requires recognition of all derivatives as either assets or
    liabilities at fair value.  The transition adjustment for the U. S. Steel
    Group related to adopting SFAS No. 133 on January 1, 2001, was immaterial.

2.  The financial statements of the U. S. Steel Group include the
    financial position, results of operations and cash flows for all businesses
    of USX other than the businesses, assets and liabilities included in the
    Marathon Group and a portion of the corporate assets and liabilities and
    related transactions which are not separately identified with ongoing
    operating units of USX.  These financial statements are prepared using the
    amounts included in the USX consolidated financial statements.  Corporate
    amounts reflected in these financial statements are determined based upon
    methods which management believes to be reasonable.  The accounting
    policies applicable to the preparation of the financial statements of the
    U. S. Steel Group may be modified or rescinded in the sole discretion of
    the Board of Directors of USX (Board), although the Board has no present
    intention to do so.  The Board may also adopt additional policies depending
    on the circumstances.

    Although the financial statements of the U. S. Steel Group and the
    Marathon Group separately report the assets, liabilities (including
    contingent liabilities) and stockholders' equity of USX attributed to each
    such Group, such attribution of assets, liabilities (including contingent
    liabilities) and stockholders' equity between the U. S. Steel Group and the
    Marathon Group for purposes of preparing their respective financial
    statements does not affect legal title to such assets and responsibility
    for such liabilities.  Holders of USX-U. S. Steel Group Common Stock (Steel
    Stock) and USX-Marathon Group Common Stock (Marathon Stock) are holders of
    common stock of USX and continue to be subject to all the risks associated
    with an investment in USX and all of its businesses and liabilities.
    Financial impacts arising from one Group that affect the overall cost of
    USX's capital could affect the results of operations and financial
    condition of the other Group.  In addition, net losses of either Group, as
    well as dividends or distributions on any class of USX Common Stock or
    series of Preferred Stock and repurchases of any class of USX Common Stock
    or series of Preferred Stock at prices in excess of par or stated value,
    will reduce the funds of USX legally available for payment of dividends on
    both classes of Common Stock.  Accordingly, the USX consolidated financial
    information should be read in connection with the U. S. Steel Group
    financial information.

<PAGE> 61

                      U. S. STEEL GROUP OF USX CORPORATION
               SELECTED NOTES TO FINANCIAL STATEMENTS (Continued)
               --------------------------------------------------
                                   (Unaudited)
                                        
                                        
2.  (Continued)
 
    The financial statement provision for income taxes and related tax
    payments or refunds have been reflected in the U. S. Steel Group and the
    Marathon Group financial statements in accordance with USX's tax allocation
    policy for such groups.  In general, such policy provides that the
    consolidated tax provision and related tax payments or refunds are
    allocated between the U. S. Steel Group and the Marathon Group for group
    financial statement purposes, based principally upon the financial income,
    taxable income, credits, preferences and other amounts directly related to
    the respective groups.

    The provision for income taxes for the U. S. Steel Group is based on
    tax rates and amounts which recognize management's best estimate of current
    and deferred tax assets and liabilities.  Differences between the combined
    interim tax provisions of the U. S. Steel and Marathon Groups and USX
    consolidated are allocated to each group based on the relationship of the
    individual group provisions to the combined interim provisions.

3.  On March 1, 2001, USX completed the purchase of the tin mill products
    business of LTV Corporation (LTV).  In this noncash transaction, USX
    assumed certain employee related obligations of LTV.  The acquisition was
    accounted for using the purchase method of accounting.  First quarter 2001
    results of operations include the operations of the LTV assets acquired
    from the date of acquisition.

    On March 23, 2001, Transtar, Inc. (Transtar) completed its previously
    announced reorganization with its two voting shareholders, USX and Transtar
    Holdings, L.P. (Holdings), an affiliate of Blackstone Capital Partners L.P.
    As a result of this transaction, USX became sole owner of Transtar and
    certain of its subsidiaries.  Holdings became owner of the other
    subsidiaries of Transtar.  USX accounted for the change in its ownership
    interest in Transtar using the purchase method of accounting.  The U. S.
    Steel Group recognized in the first quarter of 2001, a pretax gain of
    $70 million (included in income (loss) from investees) and a favorable
    deferred tax adjustment of $33 million related to this transaction.  USX
    previously accounted for its investment in Transtar under the equity method
    of accounting.

    The following unaudited pro forma data for the U. S. Steel Group
    includes the results of operations of the above acquisitions giving effect
    to them as if they had been consummated at the beginning of the years
    presented.  The first quarter 2001 pro forma results exclude the $70
    million gain and $33 million tax benefit recorded as a result of the
    Transtar transaction.  The pro forma data is based on historical
    information and does not necessarily reflect the actual results that would
    have occurred nor is it necessarily indicative of future results of
    operations.

<TABLE> 
                                                                First
                                                            Quarter Ended
                                                               March 31
     (In millions, except per share amounts)                   2001   2000
     ---------------------------------------------------------------------
     <S>                                                     <C>     <C>
     Revenues and other income                               $1,540  $1,661
     Net income (loss)                                          (94)     46
     Net income (loss) per common share (basic and diluted)   (1.09)    .49
</TABLE>


<PAGE> 62

                      U. S. STEEL GROUP OF USX CORPORATION
               SELECTED NOTES TO FINANCIAL STATEMENTS (Continued)
               --------------------------------------------------
                                   (Unaudited)


4.  The U. S. Steel Group's total comprehensive income was $7 million for
    the first quarter of 2001 and $44 million for the first quarter of 2000.

5.  The U. S. Steel Group consists of two reportable operating segments:
    1) Domestic Steel and 2) U. S. Steel Kosice (USSK).  Domestic Steel
    includes the United States operations of U. S. Steel while USSK includes
    the U. S. Steel Kosice operations primarily located in the Slovak Republic.
    Domestic Steel is engaged in the domestic production, sale and
    transportation of steel mill products, coke, taconite pellets and coal; the
    management of mineral resources; real estate development; and engineering
    and consulting services.  USSK is engaged in the production and sale of
    steel mill products and coke and primarily serves central European markets.
    The results of segment operations are as follows:

<TABLE>
                                               Domestic           Total
(In millions)                                   Steel     USSK   Segments
-----------------------------------------------------------------------------
<S>                                            <C>       <C>     <C>
FIRST QUARTER 2001
------------------
Revenues and other income:
  Customer                                     $1,262     $246    $1,508
  Intersegment (a)                                  1        -         1
  Intergroup (a)                                    2        -         2
  Equity in earnings of unconsolidated investees   47        -        47
  Other                                             6        1         7
                                               ------   ------    ------
  Total revenues and other income              $1,318     $247    $1,565
                                               ======   ======    ======
Segment income (loss)                           $(151)     $41     $(110)
                                               ======   ======    ======

FIRST QUARTER 2000
------------------
Revenues and other income:
  Customer                                     $1,578       $-    $1,578
  Intergroup (a)                                    4        -         4
  Equity in losses of unconsolidated investees     (7)       -        (7)
  Other                                            13        -        13
                                               ------   ------    ------
  Total revenues and other income              $1,588       $-    $1,588
                                               ======   ======    ======
Segment income                                    $54       $-       $54
                                               ======   ======    ======

<FN>
(a)Intersegment and intergroup sales and transfers were conducted under terms
   comparable to those with unrelated parties.
</TABLE>


<PAGE> 63

                      U. S. STEEL GROUP OF USX CORPORATION
               SELECTED NOTES TO FINANCIAL STATEMENTS (Continued)
               --------------------------------------------------
                                   (Unaudited)


5.  (Continued)

    The following schedule reconciles segment revenues and income to
    amounts reported in the U. S. Steel Group's financial statements:

<TABLE>
                                                   First Quarter Ended
                                                         March 31
 (In millions)                                        2001      2000
 ---------------------------------------------------------------------------
 <S>                                               <C>        <C>
 Revenues and other income:
  Revenues and other income of reportable segments  $1,565    $1,588
  Elimination of intersegment revenues                  (1)        -
                                                    ------    ------
     Total Group revenues and other income          $1,564    $1,588
                                                    ======    ======

 Income:
  Income (loss) for reportable segments              $(110)      $54
  Items not allocated to segments:
   Administrative expenses                              (8)       (6)
   Net pension credits                                  41        65
   Costs related to former business activities         (24)      (22)
                                                    ------    ------
     Total Group income (loss) from operations       $(101)      $91
                                                    ======    ======
</TABLE>

6.  On November 24, 2000, USX acquired U. S. Steel Kosice s.r.o. (USSK),
    which is primarily located in the Slovak Republic.  USSK was formed in June
    2000 to hold the steel operations and related assets of VSZ a.s. (VSZ), a
    diversified Slovak corporation.   The acquisition was accounted for under
    the purchase method of accounting.  VSZ did not provide historical carve-
    out financial information for its steel activities prepared in accordance
    with generally accepted accounting principles in the United States.  USX
    was unable to fully determine the effects of transfer pricing, intercompany
    eliminations and expense allocations in order to prepare such carve-out
    information from Slovak statutory reports and VSZ internal records.  USX
    broadly estimates that the unaudited pro forma effect on its first quarter
    2000 revenues, giving effect to the acquisition as if it had been
    consummated at the beginning of this period, would have been to increase
    revenues in the period by approximately $250 million.  USX cannot determine
    the unaudited pro forma effect on its first quarter 2000 net income.
    However, historical pro forma information is not necessarily indicative of
    future results of operations.


<PAGE> 64

                      U. S. STEEL GROUP OF USX CORPORATION
               SELECTED NOTES TO FINANCIAL STATEMENTS (Continued)
               --------------------------------------------------
                                   (Unaudited)


7.  Inventories are carried at the lower of cost or market.  Cost of
    inventories is determined primarily under the last-in, first-out (LIFO)
    method.

<TABLE>
                                                     (In millions)
                                                 ----------------------
                                                  March 31  December 31
                                                     2001      2000
                                                  --------------------
    <S>                                           <C>       <C>       
    Raw materials                                    $176      $214
    Semi-finished products                            434       429
    Finished products                                 268       210
    Supplies and sundry items                          79        93
                                                     ----      ----
      Total                                          $957      $946
                                                     ====      ====
</TABLE>

8.  The method of calculating net income per common share for the Steel
    Stock and Marathon Stock reflects the Board's intent that the separately
    reported earnings and surplus of the U. S. Steel Group and the Marathon
    Group, as determined consistent with the USX Restated Certificate of
    Incorporation, are available for payment of dividends on the respective
    classes of stock, although legally available funds and liquidation
    preferences of these classes of stock do not necessarily correspond with
    these amounts.

    Basic net income per share is calculated by adjusting net income for
    dividend requirements of preferred stock and is based on the weighted
    average number of common shares outstanding.

    Diluted net income per share assumes exercise of stock options,
    provided the effect is not antidilutive.

    See Note 8 of the Notes to USX Consolidated Financial Statements for
    the computation of income per share.

9.  At March 31, 2001, and December 31, 2000, income taxes receivable
    represents an estimated income tax receivable from the Marathon Group.  In
    addition, included in investments and long-term receivables at March 31,
    2001, and December 31, 2000, respectively, are $43 million and $97 million
    of income taxes receivable from the Marathon Group.  These amounts have
    been determined in accordance with the tax allocation policy discussed in
    Note 2.

10. In the first quarter of 2001, interest and other financial costs
    includes a favorable adjustment of $67 million and provision for income
    taxes includes an unfavorable adjustment of $15 million, both of which are
    related to prior years' taxes.


<PAGE> 65
                      U. S. STEEL GROUP OF USX CORPORATION
               SELECTED NOTES TO FINANCIAL STATEMENTS (Continued)
               --------------------------------------------------
                                   (Unaudited)

11. USX is the subject of, or a party to, a number of pending or
    threatened legal actions, contingencies and commitments relating to the 
    U. S. Steel Group involving a variety of matters including laws and
    regulations relating to the environment.  Certain of these matters are
    discussed below.  The ultimate resolution of these contingencies could,
    individually or in the aggregate, be material to the U. S. Steel Group
    financial statements.  However, management believes that USX will remain a
    viable and competitive enterprise even though it is possible that these
    contingencies could be resolved unfavorably to the U. S. Steel Group.  See
    discussion of Liquidity in USX Consolidated Management's Discussion and
    Analysis of Financial Condition and Results of Operations.

    The U. S. Steel Group is subject to federal, state, local and foreign
    laws and regulations relating to the environment.  These laws generally
    provide for control of pollutants released into the environment and require
    responsible parties to undertake remediation of hazardous waste disposal
    sites.  Penalties may be imposed for noncompliance.  At March 31, 2001, and
    December 31, 2000, accrued liabilities for remediation totaled $141 million
    and $137 million, respectively.  It is not presently possible to estimate
    the ultimate amount of all remediation costs that might be incurred or the
    penalties that may be imposed.

    For a number of years, the U. S. Steel Group has made substantial
    capital expenditures to bring existing facilities into compliance with
    various laws relating to the environment.  In the first quarter of 2001 and
    for the years 2000 and 1999, such capital expenditures totaled $1 million,
    $18 million and $32 million, respectively.  The U. S. Steel Group
    anticipates making additional such expenditures in the future; however, the
    exact amounts and timing of such expenditures are uncertain because of the
    continuing evolution of specific regulatory requirements.

    Guarantees by USX of the liabilities of affiliated entities of the U. S.
    Steel Group totaled $68 million at March 31, 2001.  In the event that
    any defaults of guaranteed liabilities occur, USX has access to its
    interest in the assets of the affiliates to reduce U. S. Steel Group losses
    resulting from these guarantees.  As of March 31, 2001, the largest
    guarantee for a single affiliate was $59 million.

    The U. S. Steel Group's contract commitments to acquire property,
    plant and equipment at March 31, 2001, totaled $193 million compared with
    $206 million at December 31, 2000.

12. USX has a 16% investment in Republic Technologies International LLC
    (Republic) which was accounted for under the equity method of accounting.
    During the first quarter of 2001, USX discontinued applying the equity
    method since investments in and advances to Republic had been reduced to
    zero.  Also, USX has recognized certain debt obligations of $14 million
    previously assumed by Republic.  On April 2, 2001, Republic filed a
    voluntary petition with the U.S. Bankruptcy Court to reorganize its
    operations under Chapter 11 of the U.S. Bankruptcy Code.  In the first
    quarter of 2001, as a result of Republic's action, the U. S. Steel Group
    recorded a pretax  charge of $74 million for potentially uncollectible
    receivables from Republic.


<PAGE> 66
                                        
                      U. S. STEEL GROUP OF USX CORPORATION
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                  ---------------------------------------------

     The U. S. Steel Group, through its Domestic Steel segment, is engaged in
the production, sale and transportation of steel mill products, coke, taconite
pellets and coal; the management of mineral resources; real estate development;
and engineering and consulting services and, through its U. S. Steel Kosice
("USSK") segment, primarily located in the Slovak Republic, in the production
and sale of steel mill products and coke for the central European market.
Certain business activities in Domestic Steel are conducted through joint
ventures and partially owned companies, such as USS-POSCO Industries ("USS-
POSCO"), PRO-TEC Coating Company ("PRO-TEC"), Clairton 1314B Partnership, and
Republic Technologies International, LLC ("Republic").  Management's Discussion
and Analysis should be read in conjunction with the U. S. Steel Group's
Financial Statements and Notes to Financial Statements.  The discussion of
Results of Operations should be read in conjunction with the Supplemental
Statistics provided on page 76.

     On April 24, 2001, USX announced that its Board of Directors authorized
management to proceed with the necessary steps to implement a plan of
reorganization of the corporation in order to separate the energy and steel
businesses.  The plan envisions a tax-free spin-off of the steel and steel-
related businesses of USX Corporation into a freestanding, publicly traded
company to be known as United States Steel Corporation ("U. S. Steel").  Holders
of current USX-U. S. Steel Group Common Stock would become holders of United
States Steel Corporation Common Stock.  Holders of current USX-Marathon Group
Common Stock would become holders of Marathon Oil Company Common Stock.  The
plan does not contemplate a cash distribution to shareholders.  Each new company
would carry approximately the same assets and liabilities now associated with
its existing businesses, except for a value transfer of approximately $900
million from Marathon Oil Company to U. S. Steel, intended to maintain U. S.
Steel as a strong, independent company.  The form of the value transfer would be
a reallocation of USX corporate debt between the current Marathon Group and the
U. S. Steel Group.  The plan of reorganization is subject to the approval of a
majority of the outstanding shares of each class of the current USX common
stock, receipt of a favorable tax ruling from the Internal Revenue Service
("IRS") on the tax-free nature of the transaction, completion of necessary
financing arrangements, receipt of necessary regulatory and third party
consents, and board approval of definitive documentation for the transaction.
The transaction is expected to occur at year-end, subject to the absence of any
materially adverse change in business conditions for the energy and/or steel
business, delay in obtaining the IRS ruling or other unfavorable circumstances.

     Certain sections of Management's Discussion and Analysis include forward-
looking statements concerning trends or events potentially affecting the
businesses of the U. S. Steel Group.  These statements typically contain words
such as "anticipates", "believes", "estimates", "expects", "intends" or similar
words indicating that future outcomes are not known with certainty and subject
to risk factors that could cause these outcomes to differ significantly from
those projected.  In accordance with "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995, these statements are accompanied by
cautionary language identifying important factors, though not necessarily all
such factors that could cause future outcomes to differ materially from those
set forth in forward-looking statements.  For additional risk factors affecting
the businesses of the U. S. Steel Group, see Supplementary Data -- Disclosures
About Forward-Looking Information in USX 2000 Form 10-K.

<PAGE> 67
                                        
                      U. S. STEEL GROUP OF USX CORPORATION
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATION
                  --------------------------------------------
                                        
Results of Operations
---------------------
     Revenues and other income decreased by $24 million in the first quarter of
2001 compared with the first quarter of 2000.  The decrease was primarily due to
significantly lower domestic sheet product shipment volumes (domestic steel
shipments decreased almost 550,000 tons) and prices, partially offset by
additional revenues resulting from the acquisition of USSK, in the fourth
quarter of 2000, and LTV's tin operations, in the first quarter of 2001.

     Income (loss) from operations for the U. S. Steel Group for the first
quarter of 2001 and 2000 are set forth in the following table:

<TABLE> 
                                                   First Quarter Ended
                                                         March 31
(Dollars in millions)                                   2001   2000
-------------------------------------------------------------------------
<S>                                                   <C>     <C>
Segment income (loss) for Domestic Steel(a)(b)        $(151)    $54
Segment income for U. S. Steel Kosice(c)                 41       -
                                                      -----   -----
   Income (loss) for reportable segments               (110)     54
                                                                   
Items not allocated to segment:                                    
 Net pension credits                                     41      65
 Administrative expenses                                 (8)     (6)
 Costs related to former business activities(d)         (24)    (22)
                                                      -----   -----
   Total income (loss) from operations                $(101)    $91
                                                      =====   =====
------
<FN>
  (a) The first quarter of 2001 includes a favorable $70 million for USX's
      share of gain on the Transtar reorganization and a $74 million charge for
      a substantial portion of accounts receivable from Republic.
  (b) Includes the sale, domestic production and transportation of steel
      products, coke, taconite pellets and coal; the management of mineral
      resources; real estate development; engineering and consulting services;
      and equity income from joint ventures and partially owned companies.
  (c) Includes the sale and production of steel products and coke from
      facilities primarily located in the Slovak Republic.
  (d) Includes other postretirement benefit costs and certain other
      expenses principally attributable to former business units of the
      U. S. Steel Group.
</TABLE>

Segment income for Domestic Steel

     Segment income for Domestic Steel operations decreased $205 million in the
first quarter of 2001, compared with the first quarter of 2000, primarily due to
higher energy costs, lower shipment volumes, higher costs from operating
inefficiencies primarily due to lower throughput for sheet products and lower
income from raw materials operations.

Segment income for U. S. Steel Kosice

     Segment income for USSK, which was acquired in the fourth quarter of 2000,
was $41 million for the first quarter of 2001.

<PAGE> 68
                                        
                      U. S. STEEL GROUP OF USX CORPORATION
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATION
                  --------------------------------------------

I
tem not allocated to segment

     Net pension credits associated with all of U. S. Steel Group's domestic
pension plans are not included in segment income for domestic operations.  These
net pension credits, which are primarily noncash, totaled $41 million in first
quarter of 2001, compared to $65 million in first quarter of 2000.  The $24
million decrease in net pension credits is primarily due to the transition asset
being fully amortized at the end of 2000.  Future net pension credits can vary
depending upon the market performance of plan assets, changes in actuarial
assumptions regarding such factors as a selection of a discount rate and rate of
return on assets, changes in the amortization levels of transition amounts or
prior period service costs, plan amendments affecting benefit payout levels and
profile changes in the beneficiary populations being valued.  To the extent net
pension credits decline in the future, income from operations would be adversely
affected.

     Net interest and other financial costs for the first quarters of 2001 and
2000 are set forth in the following table:

<TABLE>
                                                        First Quarter
                                                            Ended
                                                           March 31
(Dollars in millions)                                   2001    2000
----------------------------------------------------------------------------
<S>                                                    <C>      <C>
Net interest and other financial costs (income)         $(12)    $24
Less:
 Favorable adjustment to interest
                       related to prior years' taxes     (67)      -
                                                       -----   -----
Net interest and other financial costs
     adjusted to exclude above item                      $55     $24
                                                       =====   =====
</TABLE>

     Adjusted net interest and other financial costs increased by $31 million in
the first quarter of 2001 as compared with the same period in 2000.  This
increase was largely due to a higher average debt level, which primarily
resulted from the elective funding for employee benefits and the acquisition of
USSK, both of which occurred in the fourth quarter of 2000.

     The credit for income taxes in the first quarter of 2001 was $98 million.
The credit contained a $33 million tax benefit associated with the Transtar
reorganization and an unfavorable adjustment of $15 million related to prior
years' taxes.  In addition, as a result of tax credit provisions of laws of the
Slovak Republic and certain tax planning strategies, virtually no income tax
provision is recorded for income related to USSK.

     Net income in the first quarter of 2001 was $9 million, compared with net
income of $43 million in the first quarter of 2000.  Net income decreased $34
million in the first quarter of 2001 compared to the same period in 2000,
primarily reflecting the factors discussed above.

<PAGE> 69
                                        
                      U. S. STEEL GROUP OF USX CORPORATION
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATION
                  --------------------------------------------

Operating Statistics
--------------------
     First quarter 2001 U. S. Steel Group shipments were 3.2 million net tons.
Domestic Steel shipments of 2.4 million tons and raw steel production of 2.6
million tons decreased 18% and 17%, respectively, from the same period in 2000.
Domestic raw steel capability utilization in the first quarter of 2001 averaged
83%, compared to 99% in the same period in 2000.  At USSK, first quarter 2001
shipments were 749 thousand net tons, raw steel production was 952 thousand net
tons and raw steel capability utilization was 86%.

Cash Flows
----------
     Net cash provided from operating activities increased $200 million in the
first quarter of 2001, compared with the first quarter of 2000.  The increase
was due primarily to favorable working capital changes, which included a
favorable intergroup income tax settlement of $364 million in the first quarter
of 2001 compared to a favorable intergroup settlement of $97 million in the
first quarter of 2000, partially offset by decreased net income (excluding
noncash items).

     Capital expenditures in the first quarter of 2001 were $37 million,
compared with $45 million in the same period in 2000.  The decrease of $8
million is due to a reduction in budgeted projects.

     Financial obligations decreased by $226 million in the first quarter of
2001, reflecting favorable cash from operations, partially offset by capital
expenditures and dividend payments.  Financial obligations consist of the
U. S. Steel Group's portion of USX debt and preferred stock of a subsidiary
attributed to both groups, as well as debt and financing agreements specifically
attributed to the U. S. Steel Group.

     Contract commitments at March 31, 2001, totaled $193 million, compared with
$206 million at December 31, 2000.

Derivative Instruments
----------------------
     See Quantitative and Qualitative Disclosures About Market Risk for
discussion of derivative instruments and associated market risk for U. S. Steel
Group.

Liquidity
---------
     For discussion of USX's liquidity and capital resources, see Management's
Discussion and Analysis of USX Consolidated Financial Condition, Cash Flows and
Liquidity.



<PAGE> 70
                                        
                      U. S. STEEL GROUP OF USX CORPORATION
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATION
                  --------------------------------------------
                                        
Environmental Matters, Litigation and Contingencies
---------------------------------------------------
     The U. S. Steel Group has incurred and will continue to incur substantial
capital, operating and maintenance, and remediation expenditures as a result of
environmental laws and regulations.  In recent years, these expenditures have
been mainly for process changes in order to meet Clean Air Act obligations,
although ongoing compliance costs have also been significant.  To the extent
these expenditures, as with all costs, are not ultimately reflected in the
prices of the U. S. Steel Group's products and services, operating results will
be adversely affected.  The U. S. Steel Group believes that all of its domestic
competitors are subject to similar environmental laws and regulations.  However,
the specific impact on each competitor may vary depending on a number of
factors, including the age and location of its operating facilities, marketing
areas, production processes and the specific products and services it provides.
To the extent that competitors are not required to undertake equivalent costs in
their operations, the competitive position of the U. S. Steel Group could be
adversely affected.

     In addition, the U. S. Steel Group expects to incur capital expenditures
for its USSK operation to meet environmental standards under the Slovak
Republic's environmental laws.

     USX has been notified that it is a potential responsible party ("PRP") at
25 waste sites related to the U. S. Steel Group under the Comprehensive
Environmental Response, Compensation and Liability Act ("CERCLA") as of March
31, 2001.  In addition, there are 16 sites related to the U. S. Steel Group
where USX has received information requests or other indications that USX may be
a PRP under CERCLA but where sufficient information is not presently available
to confirm the existence of liability or to make any judgment as to the amount
thereof.  There are also 29 additional sites related to the U. S. Steel Group
where remediation is being sought under other environmental statutes, both
federal and state, or where private parties are seeking remediation through
discussions or litigation. At many of these sites, USX is one of a number of
parties involved and the total cost of remediation, as well as USX's share
thereof, is frequently dependent upon the outcome of investigations and remedial
studies.  The U. S. Steel Group accrues for environmental remediation activities
when the responsibility to remediate is probable and the amount of associated
costs is reasonably determinable.  As environmental remediation matters proceed
toward ultimate resolution or as additional remediation obligations arise,
charges in excess of those previously accrued may be required.

     In October 1996, USX was notified by the Indiana Department of
Environmental Management ("IDEM"), acting as lead trustee, that IDEM and the
U.S. Department of the Interior had concluded a preliminary investigation of
potential injuries to natural resources related to the releases of hazardous
substances from various municipal and industrial sources along the east branch
of the Grand Calumet River and Indiana Harbor Canal.  The public trustees
completed a pre-assessment screen pursuant to federal regulations and have
determined to perform a Natural Resource Damages Assessment. USX was identified
as a PRP along with 15 other companies owning property along the river and
harbor canal.  USX and eight other PRPs have formed a joint defense group.  In
2000, the trustees concluded their assessment of sediment injuries, which
includes a technical review of environmental conditions.  The PRP joint defense
group has proposed terms for the settlement of this claim which have been
endorsed by representatives of the trustees and the U.S. Environmental
Protection Agency ("EPA") to be included in a consent decree that USX expects
will resolve this claim.  A reserve has been established for the USX share of
this anticipated settlement.

<PAGE> 71
                                        
                      U. S. STEEL GROUP OF USX CORPORATION
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATION
                  --------------------------------------------
                                        
     The Berks Associates/Douglassville Site ("Berks Site") is situated on a 50-
acre parcel located on the Schuylkill River in Berks County, Pa.  Used oil and
solvent reprocessing operations were conducted on the Berks Site between 1941
and 1986.  In September 1997, USX signed a consent decree to conduct a
feasibility study at the site relating to the alternative remedy.  In 1999, a
new Record of Decision was approved by the EPA and the U.S. Department of
Justice.  On January 19, 2001, USX signed a consent decree with the EPA to
remediate this site.  On April 6, 2001, USX paid $.4 million for costs
associated with this site.  The only remaining outstanding claim is the natural
resource damages claim filed by the Commonwealth of Pennsylvania.

     USX is the subject of, or a party to, a number of pending or threatened
legal actions, contingencies and commitments relating to the U. S. Steel Group
involving a variety of matters, including laws and regulations relating to the
environment, certain of which are discussed in Note 11 to the U. S. Steel Group
Financial Statements.  The ultimate resolution of these contingencies could,
individually or in the aggregate, be material to the U. S. Steel Group Financial
Statements.  However, management believes that USX will remain a viable and
competitive enterprise even though it is possible that these contingencies could
be resolved unfavorably to the U. S. Steel Group.

Outlook
-------
     Domestic Steel continues to experience mills that are running at less-than-
efficient utilization rates, depressed prices for most products and high natural
gas prices.  While the domestic order book is improving, primarily for hot-
rolled sheet products, U. S. Steel Group will continue to be negatively impacted
by less-than-efficient utilization rates if the improved order rate is not
maintained.  For Domestic Steel, U. S. Steel Group expects second quarter
shipments to be approximately 10 percent higher than first quarter and second
quarter average realized prices to be somewhat lower than the first quarter,
largely due to a less favorable product mix.  Late in the second quarter, work
will begin on the refurbishment of the Mon Valley No. 3 blast furnace, which
will require an outage, into the third quarter, of approximately 60 days.

     For USSK, second quarter shipments are expected to be more than 30 percent
higher than the first quarter and second quarter average realized prices are
expected to be somewhat lower than the first quarter, largely due to a less
favorable product mix.

     For the full year 2001, total shipments are expected to be approximately
14.5 million net tons with Domestic Steel shipments of approximately 11 million
net tons, including shipments from the recent acquisition of LTV's tin products
business, and USSK shipments of approximately 3.5 million net tons.



<PAGE> 72
                                        
                      U. S. STEEL GROUP OF USX CORPORATION
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATION
                  --------------------------------------------
                                        
     USX owns a 16 percent equity method investment in Republic (through USX's
ownership in Republic Technologies International Holdings, LLC, which is the
sole owner of Republic), which is a major purchaser of raw materials from U. S.
Steel Group and the primary supplier of rounds for the tubular facility in
Lorain, Ohio.  On April 2, 2001, Republic filed to reorganize under Chapter 11
of the U.S. Bankruptcy Code.  Republic has continued to supply the Lorain mill
since filing for bankruptcy and no supply interruptions are anticipated.  The
U. S. Steel Group's carrying value of this investment in Republic has been
reduced to zero.  Upon Republic's filing for bankruptcy, U. S. Steel Group
accrued a charge for a substantial portion of the receivables due from Republic.
At March 31, 2001, U. S. Steel Group's remaining financial exposure to Republic,
after recording various losses and reserves, totaled approximately $30 million.

     In connection with the plan of reorganization described on page 66,
Standard & Poor's reported that they had assigned a BB+ corporate credit rating
to the new U. S. Steel with a stable outlook, assuming the reorganization is
completed.

     The above discussion includes forward-looking statements concerning
shipments, pricing, equity investee performance and the plan of reorganization.
These statements are based on assumptions as to future product demand, prices
and mix, and production. Steel shipments and prices can be affected by imports
and actions of the U.S. Government and its agencies pertaining to trade,
domestic and international economies, domestic production capacity, and customer
demand.  Factors which may affect USSK results are similar to domestic factors,
including excess world supply, and also can be influenced by matters peculiar to
international marketing such as tariffs.  USSK results may also be affected by
foreign currency fluctuations.  Some factors which will affect the plan of
reorganization include approval of a majority of the outstanding shares of each
class of the current USX common stock, receipt of a favorable ruling from the
IRS on the tax-free nature of the transaction, completion of necessary financing
arrangements, receipt of necessary regulatory and third-party consents, any
materially adverse changes in the business conditions for the energy and/or
steel businesses, board approval of definitive documentation of the transaction
or other unfavorable circumstances.  In the event these assumptions prove to be
inaccurate, actual results may differ significantly from those presently
anticipated.

     Steel imports to the United States accounted for an estimated 22%, 27% and
26% of the domestic steel market in the first two months of 2001, and for the
years 2000 and 1999, respectively.

     On November 13, 2000, U. S. Steel Group joined with eight other producers
and the Independent Steelworkers Union to file trade cases against hot-rolled
carbon steel flat products from 11 countries (Argentina, India, Indonesia,
Kazakhstan, the Netherlands, the People's Republic of China, Romania, South
Africa, Taiwan, Thailand and Ukraine).  Three days later, the USWA also entered
the cases as a petitioner.  Antidumping ("AD") cases were filed against all the
countries and countervailing duty ("CVD") cases were filed against Argentina,
India, Indonesia, South Africa, and Thailand.  The U.S. International Trade
Commission ("ITC") made a preliminary determination that there is a reasonable
indication that the domestic industry is being materially injured by the imports
in question and the U.S. Department of Commerce ("Commerce") has made
preliminary findings of margins in all of the cases.  As a result, both the ITC
and Commerce will continue their investigations.

<PAGE> 73
                                        
                      U. S. STEEL GROUP OF USX CORPORATION
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATION
                  --------------------------------------------
                                        
     U. S. Steel Group believes that the remedies provided by U.S. law to
private litigants are insufficient to correct the widespread dumping and subsidy
abuses that currently characterize steel imports into our country.  U. S. Steel
Group, nevertheless, intends to file additional AD and CVD petitions against
unfairly traded imports that adversely impact, or threaten to adversely impact,
the results of the U. S. Steel Group and is urging the U.S. government to take
additional steps.

     On July 3, 2000, Commerce and the ITC initiated mandatory five-year
"sunset" reviews of AD orders issued in 1995 against seamless pipe from
Argentina, Brazil, Germany and Italy and oil country tubular goods ("OCTG") from
Argentina, Italy, Japan, Mexico and South Korea.  The reviews also encompass the
1995 CVD orders against the same two products from Italy.  The "sunset" review
procedures require that an order must be revoked after five years unless
Commerce and the ITC determine that, if the orders would be discontinued,
dumping or a countervailable subsidy would be likely to continue or recur.  In
all of the cases, Commerce has concluded its review and has determined that
dumping or countervailable subsidies would be likely to continue or recur if the
orders are discontinued.  The ITC is conducting full reviews in all the cases,
despite the fact that responses by some of the respondent countries were
inadequate.


<PAGE> 74
                                        
                      U. S. STEEL GROUP OF USX CORPORATION
                          QUANTITATIVE AND QUALITATIVE
                          DISCLOSURES ABOUT MARKET RISK
                      ------------------------------------

Commodity Price Risk and Related Risks
--------------------------------------
      Sensitivity analysis of the incremental effects on pretax income of
hypothetical 10% and 25% changes in commodity prices for commodity-based
derivative instruments are provided in the following table(a):

<TABLE>
                                            Incremental Decrease in
                                           Income Before Income Taxes
                                            Assuming a Hypothetical
                                                Price Change of:

(Dollars in millions)                             10%     25%
---------------------------------------------------------------------------
<S>                                               <C>     <C>   <C>
Commodity-Based Derivative Instruments
U. S. Steel Group
    Zinc
       Other than trading                         2.0     5.0   (b)
    Tin
       Other than trading                         0.3     0.7   (b)
<FN>
 (a)  Gains and losses on commodity-based derivative instruments used for
      other than trading activities are generally offset by price changes in
      the underlying commodity.  With the adoption of SFAS No. 133, the
      definition of a derivative instrument has been expanded to include
      certain fixed price physical commodity contracts.  Such instruments are
      included in the above table.  Amounts reflect the estimated incremental
      effect on pretax income of a hypothetical 10% and 25% changes in closing
      commodity prices at March 31, 2001.  Management evaluates the portfolios
      of commodity-based derivative instruments on an ongoing basis and adjusts
      strategies to reflect anticipated market conditions, changes in risk
      profiles and overall business objectives.  Changes to the portfolios
      subsequent to March 31, 2001, may cause future pretax income effects to
      differ from those presented in the table.
 (b)  Price decrease.
</TABLE>

Interest Rate Risk
------------------
     As of March 31, 2001, the discussion of the U. S. Steel Group's interest
rate risk has not changed materially from that presented in Quantitative and
Qualitative Disclosures About Market Risk included in USX's 2000 Form 10-K.

Foreign Currency Exchange Rate Risk
-----------------------------------
     USX is subject to the risk of price fluctuations related to anticipated
revenues and operating costs, firm commitments for capital expenditures and
existing assets or liabilities denominated in currencies other than U.S.
dollars. USX has not generally used derivative instruments to manage this risk.
However, USX has made limited use of forward currency contracts to manage
exposure to certain currency price fluctuations. At March 31, 2001, the U. S.
Steel Group had open Euro forward sale contracts for both U.S. dollars and
Slovak Koruna.  A 10% increase in the March 31, 2001 Euro forward rates would
result in an immaterial charge to income. The entire amount of these contracts
is attributed to the U. S. Steel Group.

<PAGE> 75
                                        
                      U. S. STEEL GROUP OF USX CORPORATION
                          QUANTITATIVE AND QUALITATIVE
                          DISCLOSURES ABOUT MARKET RISK
                      ------------------------------------

Equity Price Risk
-----------------
     As of March 31, 2001, the discussion of the U. S. Steel Group's equity
price risk has not changed materially from that presented in Quantitative and
Qualitative Disclosures About Market Risk included in USX's 2000 Form 10-K.

Safe Harbor
-----------
     The U. S. Steel Group's quantitative and qualitative disclosures about
market risk include forward-looking statements with respect to management's
opinion about risks associated with the U. S. Steel Group's use of derivative
instruments. These statements are based on certain assumptions with respect to
market prices and industry supply and demand for steel products and certain raw
materials. To the extent that these assumptions prove to be inaccurate, future
outcomes with respect to the U. S. Steel Group's hedging programs may differ
materially from those discussed in the forward-looking statements.


<PAGE> 76
                      U. S. STEEL GROUP OF USX CORPORATION
                       SUPPLEMENTAL STATISTICS (Unaudited)
                      -------------------------------------

<TABLE>
                                                     First Quarter Ended
                                                           March 31
(Dollars in millions)                                   2001    2000
-------------------------------------------------------------------------
<S>                                                     <C>     <C>
INCOME (LOSS) FROM OPERATIONS                                        
Domestic Steel(a)(b)                                    $(151)    $54
U. S. Steel Kosice(c)                                      41       -
                                                        -----   -----
Income (loss) from Reportable Segments                  $(110)    $54
 Items not allocated to segment:                                     
  Net Pension Credits                                      41      65
  Administrative Expenses                                  (8)     (6)
  Costs related to former business activities(d)          (24)    (22)
                                                        -----   -----
   Total U. S. Steel Group                              $(101)    $91
                                                                     
CAPITAL EXPENDITURES                                                 
 Domestic Steel                                           $32     $45
 U. S. Steel Kosice                                         5       -
                                                        -----   -----
   Total U. S. Steel Group                                $37     $45
                                                                     
OPERATING STATISTICS                                                 
 Average steel price per ton: ($/net ton)                            
   Domestic Steel                                        $439    $438
   U. S. Steel Kosice                                     293       -
 Steel Shipments:(e)                                                 
   Domestic Steel                                       2,432   2,980
   U. S. Steel Kosice                                     749       -
                                                        -----   -----
     Total Steel Shipments                              3,181   2,980
 Raw Steel-Production:(e)                                            
   Domestic Steel                                       2,623   3,152
   U. S. Steel Kosice                                     952       -
                                                        -----   -----
     Total Raw Steel-Production                         3,575   3,152
 Raw Steel-Capability Utilization:(f)                                
   Domestic Steel                                       83.1%   99.0%
   U. S. Steel Kosice                                   85.8%       -
 Iron ore shipments - Domestic Steel(e)                 1,911   2,029
-----------
<FN>
 (a)  The first quarter of 2001 includes a favorable $70 million for USX's
      share of gain on the Transtar reorganization and a $74 million charge for
      a substantial portion of accounts receivable from Republic.
 (b)  Includes the sale, domestic production and transportation of steel
      products, coke, taconite pellets and coal; the management of mineral
      resources; real estate development; engineering and consulting services;
      and equity income from joint ventures and partially owned companies.
 (c)  Includes the production and sale of steel products and coke from
      facilities primarily located in the Slovak Republic.
 (d)  Includes other postretirement benefit costs and certain other
      expenses principally attributable to former business units of the U. S.
      Steel Group.
 (e)  Thousands of net tons.
 (f)  Based on annual raw steel production capability of 12.8 million tons
      for Domestic Steel and 4.5 million tons for U. S. Steel Kosice.
</TABLE>


<PAGE> 77


Part II - Other Information:
---------------------------

Item 1. LEGAL PROCEEDINGS

Marathon Group

Environmental Proceedings

     In October 1998, the National Enforcement Investigations Center and Region
V of the U.S. Environmental Protection Agency ("EPA") conducted a multi-media
inspection of MAP's Detroit refinery.  Subsequently, in November 1998, Region V
conducted a multi-media inspection of MAP's Robinson refinery.  These
inspections covered compliance with the Clean Air Act (New Source Performance
Standards, Prevention of Significant Deterioration, and the National Emission
Standards for Hazardous Air Pollutants for Benzene), the Clean Water Act (Permit
exceedances for the Waste Water Treatment Plant), reporting obligations under
the Emergency Planning and Community Right to Know Act and the handling of
process waste.  MAP has been served with two Notices of Violation ("NOV") and
three Findings of Violation in connection with the multi-media inspections at
its Detroit refinery. The Detroit notices allege violations of the Michigan
State Air Pollution Regulations, the EPA New Source Performance Standards and
National Emission Standards for Hazardous Air Pollutants for benzene.  On 
March 6, 2000, MAP received its first NOV arising out of the multi-media 
inspection of the Robinson Refinery conducted in November 1998.  The NOV is for
alleged Resource Conservation and Recovery Act (hazardous waste) violations.

     MAP has recently settled with the EPA certain New Source Review ("NSR")
compliance issues as well as multi-media issues related to the EPA's 1998 
multi-media inspections of the Detroit and Robinson refineries.  MAP's
settlement with the EPA includes all of MAP's refineries and commits MAP to 
specific control technologies and implementation schedules for approximately 
$263 million in environmental capital expenditures and improvements to MAP's 
refineries over approximately an 8 year period that are consistent with MAP's 
current capital spending plans.  It also commits MAP to payment of an aggregate
civil penalty in the amount of $3.8 million and the performance of $6.5 million 
in supplemental environmental projects as a part of an enforcement action for
alleged Clean Air Act violations.  MAP believes that the settlement will 
provide MAP with increased permitting and operating flexibility while achieving
significant emission reductions.

U. S. Steel Group

Environmental Proceedings

     The Berks Associates/Douglassville Site ("Berks Site") is situated on a 50-
acre parcel located on the Schuylkill River in Berks County, Pa.  Used oil and
solvent reprocessing operations were conducted on the Berks Site between 1941
and 1986.  In September 1997, USX signed a consent decree to conduct a
feasibility study at the site relating to the alternative remedy.  In 1999, a
new Record of Decision was approved by the EPA and the U.S. Department of
Justice.  On January 19, 2001, USX signed a consent decree with the EPA to
remediate this site.  On April 6, 2001, USX paid $.4 million for costs
associated with this site.  The only remaining outstanding claim is the natural
resource damages claim filed by the Commonwealth of Pennsylvania.

<PAGE> 78

Part II - Other Information (Continued):
----------------------------------------


Item 5.  OTHER INFORMATION

     Marathon Group
     
      SUMMARIZED CONSOLIDATED FINANCIAL INFORMATION OF MARATHON OIL COMPANY
                               Supplementary Data
      ---------------------------------------------------------------------
                                   (Unaudited)

The following summarized consolidated financial information of Marathon Oil
Company, a wholly owned subsidiary of USX, is included in this Form 10-Q in
satisfaction of the reporting obligation of Marathon which has debt securities
registered under the Securities Exchange Act.  All such securities are
guaranteed by USX.

<TABLE>
                                                       (In millions)
                                                    -------------------
                                                    First Quarter Ended
                                                          March 31
                                                      2001       2000
                                                      ----       ----
<S>                                                <C>        <C>
INCOME DATA:
Revenues and other income                           $8,735     $7,855
Income from operations                                 924        533
Net income                                             513        262


                                                       (In millions)
                                                  ------------------------
                                                   March 31   December 31
                                                     2001         2000
                                                   --------   -----------
BALANCE SHEET DATA:
Assets:
Current assets                                      $7,052      $7,397
Noncurrent assets                                   11,061      10,135
                                                    ------      ------
Total assets                                       $18,113     $17,532
                                                    ======      ======

Liabilities and Stockholder's Equity:
Current liabilities                                 $4,011      $3,951
Noncurrent liabilities                               7,986       8,110
Preferred stock of subsidiary                            9           9
Minority interest in income of 
  Marathon Ashland Petroleum LLC                     1,938       1,840
Stockholder's equity                                 4,169       3,622
                                                    ------      ------
Total liabilities and stockholder's equity         $18,113     $17,532
                                                    ======      ======
</TABLE>


<PAGE> 79

Part II - Other Information (Continued):
----------------------------------------


     Item 6.  EXHIBITS AND REPORTS ON FORM 8-K

     (a)  EXHIBITS

               12.1 Computation of Ratio of Earnings to Combined
                    Fixed Charges and Preferred Stock Dividends

               12.2 Computation of Ratio of Earnings to
                    Fixed Charges


     (b)  REPORTS ON FORM 8-K

               Form 8-K dated January 24, 2001, reporting under Item 9.
Regulation FD disclosure, the USX-Marathon Group and USX-U. S. Steel Group
Earnings Releases.

               Form 8-K dated February 27, 2001, reporting under Item 5. Other
Events, the filing of the audited Financial Statements and Supplementary Data
for the fiscal year ended December 31, 2000, reports of independent accountants.

               Form 8-K dated April 24, 2001, reporting under Item 9. Regulation
FD Disclosure, that USX Corporation is furnishing information under Regulation
FD for the April 24, 2001 press releases titled "USX Announces Plan of
Reorganization" and "USX Corporation Declares First Quarter Marathon Dividend
and Reduced U. S. Steel Group Dividend."

               Form 8-K dated April 24, 2001, reporting under Item 5. Other
Events, that USX Corporation is filing information for the April 24, 2001 press
releases titled "USX Announces Plan of Reorganization" and "USX Corporation
Declares First Quarter Marathon Dividend and Reduced U. S. Steel Group
Dividend."

               Form 8-K dated May 8, 2001, reporting under Item 9. Regulation FD
Disclosure, the statement concerning the impact of the plan of reorganization on
preferred securities and industrial revenue bonds.

<PAGE> 80


Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned chief accounting officer thereunto duly authorized.

      USX CORPORATION


      By /s/ Larry G. Schultz
      ------------------------
          Larry G. Schultz
          Vice President -
             Accounting

May 11, 2001







                                                                    Exhibit 12.1

<TABLE>
<CAPTION>                                        
                                 USX CORPORATION
           COMPUTATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES
                          AND PREFERRED STOCK DIVIDENDS
                      TOTAL ENTERPRISE BASIS - (Unaudited)
                              CONTINUING OPERATIONS
           ----------------------------------------------------------
                              (Dollars in Millions)
                                        
                            First Quarter
                                Ended       Year Ended December 31
                               March 31  ----------------------------
                             2001  2000  2000  1999  1998  1997  1996
                             ----  ----  ----  ----  ----  ----  ----
<S>                          <C>   <C>   <C>   <C>   <C>   <C>   <C>
Portion of rentals
  representing interest       $24   $24  $100   $95  $105   $82   $78
Capitalized interest            7     2    19    26    46    31    11
Other interest and fixed
  charges                      23   100   375   365   318   352   428
Pretax earnings which would
  be required to cover
  preferred stock dividend
  requirements of parent        3     3    12    14    15    20    37
                             ----  ----  ----  ----  ----  ----  ----
Combined fixed charges
  and preferred stock
  dividends (A)               $57  $129  $506  $500  $484  $485  $554
                             ====  ====  ====  ====  ====  ====  ====
Earnings-pretax income
  with applicable
  adjustments (B)            $786  $666 $1920 $2098 $1671 $1761 $1887
                             ====  ====  ====  ====  ====  ====  ====

Ratio of (B) to (A)         13.79  5.16  3.79  4.20  3.45  3.63  3.41
                             ====  ====  ====  ====  ====  ====  ====
</TABLE>







                                                                    Exhibit 12.2

<TABLE>
<CAPTION>                                                                               
                                                                                
                                 USX CORPORATION
                COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
                      TOTAL ENTERPRISE BASIS - (Unaudited)
                              CONTINUING OPERATIONS
                -------------------------------------------------
                              (Dollars in Millions)
                                        
                            First Quarter
                                Ended       Year Ended December 31
                               March 31  ----------------------------
                             2001  2000  2000  1999  1998  1997  1996
                             ----  ----  ----  ----  ----  ----  ----
<S>                          <C>   <C>   <C>   <C>   <C>   <C>   <C>
Portion of rentals
  representing interest       $24   $24  $100   $95  $105   $82   $78
Capitalized interest            7     2    19    26    46    31    11
Other interest and fixed
  charges                      23   100   375   365   318   352   428
                             ----  ----  ----  ----  ----  ---- -----
Total fixed charges (A)       $54  $126  $494  $486  $469  $465  $517
                             ====  ====  ====  ====  ====  ====  ====
Earnings-pretax income
  with applicable
  adjustments (B)            $786  $666 $1920 $2098 $1671 $1761 $1887
                             ====  ====  ====  ====  ====  ====  ====
Ratio of (B) to (A)         14.56  5.29  3.89  4.32  3.56  3.79  3.65
                             ====  ====  ====  ====  ====  ====  ====

</TABLE>