Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2026

Assets and Liabilities Accounted for at Fair Value on Recurring Basis

The following tables present assets and liabilities accounted for at fair value on a recurring basis as of March 31, 2026 and December 31, 2025 by fair value hierarchy level. We have elected to offset the fair value amounts recognized for multiple derivative contracts executed with the same counterparty, including any related cash collateral as shown below; however, fair value amounts by hierarchy level are presented on a gross basis in the following tables.


	March 31, 2026
	Fair Value Hierarchy
(Millions of dollars)	Level 1		Level 2		Level 3		Netting and Collateral(a)		Net Carrying Value on Balance Sheet(b)		Collateral Pledged Not Offset
Assets:
Commodity contracts	$	3,140	$	—	$	—	$	(3,127)	$	13	$	347
Liabilities:
Commodity contracts	$	3,638	$	—	$	7	$	(3,638)	$	7	$	—
Embedded derivatives in commodity contracts	—		—		54		—		54		—
Contingent consideration	—		—		239		—		239		—


	December 31, 2025
	Fair Value Hierarchy
(Millions of dollars)	Level 1		Level 2		Level 3		Netting and Collateral(a)		Net Carrying Value on Balance Sheet(b)		Collateral Pledged Not Offset
Assets:
Commodity contracts	$	243	$	—	$	—	$	(226)	$	17	$	10
Liabilities:
Commodity contracts	$	236	$	—	$	—	$	(236)	$	—	$	—
Embedded derivatives in commodity contracts	—		—		41		—		41		—
Contingent consideration	—		—		236		—		236		—

(a)Represents the impact of netting assets, liabilities and cash collateral when a legal right of offset exists. As of March 31, 2026, cash collateral of $511 million was netted with mark-to-market derivative liabilities. As of December 31, 2025, cash collateral of $10 million was netted with mark-to-market derivative liabilities.

(b)We have no derivative contracts which are subject to master netting arrangements reflected gross on the balance sheet.

Reconciliation of Net Beginning and Ending Balances Recorded for Net Assets and Liabilities Classified as Level 3

The following is a reconciliation of the beginning and ending balances recorded for net liabilities classified as Level 3 in the fair value hierarchy.


	Three Months Ended March 31,
(Millions of dollars)	2026		2025
Beginning balance	$	277	$	58

Unrealized and realized loss included in net income(a)	24		7
Settlements of derivative instruments	(1)		(3)
Ending balance	$	300	$	62

The amount of total loss for the period included in earnings attributable to the change in unrealized loss relating to liabilities still held at the end of period(a):	$	25	$	7

(a) The loss is included in cost of revenues on the consolidated statements of income.

- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

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