v3.26.1
FAIR VALUE MEASUREMENTS
 6 Months Ended
Jun. 30, 2026
Fair Value Disclosures [Abstract]  
FAIR VALUE MEASUREMENTS FAIR VALUE MEASUREMENTS
Determining Fair Value - For our fair value measurements, we utilize market prices, third-party pricing services, present value methods and standard option valuation models to determine the price we would receive from the sale of an asset or the transfer of a liability in an orderly transaction at the measurement date. We measure the fair value of a group of financial assets and liabilities consistent with how a market participant would price the net risk exposure at the measurement date. Determining the appropriate classification of our fair value measurements within the fair value hierarchy requires management’s judgment regarding the degree to which market data is observable or corroborated by observable market data. We categorize derivatives based on the lowest level input that is significant to the fair value measurement in its entirety. Our valuation techniques and inputs are consistent with those discussed in Note A of the Notes to Consolidated Financial Statements in our Annual Report.

Recurring Fair Value Measurements - The following tables set forth our recurring fair value measurements as of the dates indicated:
June 30, 2026
Level 1Level 2Level 3Total - GrossNetting (a)Total - Net
(Millions of dollars)
Derivative assets
Commodity contracts$76 $116 $— $192 $(155)$37 
Total derivative assets$76 $116 $— $192 $(155)$37 
Derivative liabilities
Commodity contracts$(96)$(59)$— $(155)$155 $— 
Total derivative liabilities$(96)$(59)$— $(155)$155 $— 
(a) - Derivative assets and liabilities are presented in our Consolidated Balance Sheets on a net basis. We net derivative assets and liabilities when a legally enforceable master-netting arrangement exists between the counterparty to a derivative contract and us. At June 30, 2026, we held no cash and posted cash of $46 million with a counterparty, which is included in other current assets in our Consolidated Balance Sheets.
December 31, 2025
Level 1Level 2Level 3Total - GrossNetting (a)Total - Net
(Millions of dollars)
Derivative assets
Commodity contracts$60 $69 $— $129 $(67)$62 
Total derivative assets$60 $69 $— $129 $(67)$62 
Derivative liabilities
Commodity contracts$(21)$(46)$— $(67)$67 $— 
Total derivative liabilities$(21)$(46)$— $(67)$67 $— 
(a) - Derivative assets and liabilities are presented in our Consolidated Balance Sheets on a net basis. We net derivative assets and liabilities when a legally enforceable master-netting arrangement exists between the counterparty to a derivative contract and us. At December 31, 2025, we held no cash and posted cash of $4 million with a counterparty, which is included in other current assets in our Consolidated Balance Sheets.

Other Financial Instruments - The approximate fair value of cash and cash equivalents, accounts receivable, accounts payable and short-term borrowings is equal to book value due to the short-term nature of these items. Our cash and cash equivalents are composed of bank and money market accounts and are classified as Level 1. Our short-term borrowings are classified as Level 2 since the estimated fair value of the short-term borrowings can be determined using significant observable market data, including interest rates and credit spreads. We have investments associated with our supplemental executive retirement plan and nonqualified deferred compensation plan that are carried at fair value and primarily are composed of mutual funds, municipal bonds and other fixed income securities classified as Level 1 and Level 2.

The book value of our consolidated long-term debt, including current maturities, was $31.5 billion and $32.0 billion at June 30, 2026, and December 31, 2025, respectively. The estimated fair value of our consolidated long-term debt, including current maturities, was $31.8 billion and $32.7 billion at June 30, 2026, and December 31, 2025, respectively. The estimated fair value of the aggregate senior notes outstanding was determined using quoted market prices for similar issues with similar terms and maturities. The estimated fair value of our consolidated long-term debt is classified as Level 2.