v3.26.1
Derivative Financial Instruments and Risk Management (Tables)
 6 Months Ended
Jun. 30, 2026
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Summary of Location and Fair Value of Derivative Instruments
The location and fair value of derivative instruments reported in the Consolidated Statement of Financial Position were as follows:

(Millions of dollars)Fair Value
June 30, 2026December 31, 2025
Assets 1
Liabilities 2
Assets 1
Liabilities 2
Designated derivatives
Foreign exchange contracts$296 $(174)$364 $(147)
Interest rate contracts34 (137)59 (99)
Total$330 $(311)$423 $(246)
Undesignated derivatives
Foreign exchange contracts$84 $(43)$62 $(75)
Commodity contracts13 (15)10 (2)
Total return swap contracts40 (1)1 (2)
Total$137 $(59)$73 $(79)
1 Assets are classified as Receivables - trade and other or Long-term receivables - trade and other.
2 Liabilities are classified as Accrued expenses or Other liabilities.
Schedule of Gains (Losses) on Derivative Instruments
Gains (losses) on derivative instruments are categorized as follows:

(Millions of dollars)Three Months Ended June 30,
Gains (Losses) Recognized in the Consolidated Statement of Results of Operations 1
Gains (Losses) Recognized in AOCI
Gains (Losses) Reclassified from AOCI 2
202620252026202520262025
Cash Flow Hedges
Foreign exchange contracts$— $— $41 $139 $(32)$72 
Interest rate contracts— — 13 15 2 1 
Fair Value Hedges
Foreign exchange contracts— — (5)(2)(4)(1)
Interest rate contracts(3)(20)— — — — 
Undesignated Hedges
Foreign exchange contracts38 (83)— — — — 
Commodity contracts(4)(3)— — — — 
Total return swap contracts145 56 — — — — 
Total$176 $(50)$49 $152 $(34)$72 
1 Foreign exchange contract, Commodity contract and Total return swap contract gains (losses) are included in Other income (expense). Interest rate contract gains (losses) are included in Interest expense of Financial Products and Interest expense excluding Financial Products.
2 Foreign exchange contract gains (losses) are primarily included in Other income (expense). Interest rate contract gains (losses) are primarily included in Interest expense of Financial Products.
(Millions of dollars)Six Months Ended June 30,
Gains (Losses) Recognized in the Consolidated Statement of Results of Operations 1
Gains (Losses) Recognized in AOCI
Gains (Losses) Reclassified from AOCI 2
202620252026202520262025
Cash Flow Hedges
Foreign exchange contracts$— $— $(133)$217 $(133)$72 
Interest rate contracts— — 34 13 3 2 
Fair Value Hedges
Foreign exchange contracts— — (8)(2)(7)(1)
Interest rate contracts(6)(38)— — — — 
Undesignated Hedges
Foreign exchange contracts56 (97)— — — — 
Commodity contracts38 5 — — — — 
Total return swap contracts164 30 — — — — 
Total$252 $(100)$(107)$228 $(137)$73 
1 Foreign exchange contract, Commodity contract and Total return swap contract gains (losses) are included in Other income (expense). Interest rate contract gains (losses) are included in Interest expense of Financial Products and Interest expense excluding Financial Products.
2 Foreign exchange contract gains (losses) are primarily included in Other income (expense). Interest rate contract gains (losses) are primarily included in Interest expense of Financial Products.
Summary of Cumulative Basis Adjustments for Fair Value Hedges
The following amounts were recorded in the Consolidated Statement of Financial Position related to cumulative basis adjustments for fair value hedges:

(Millions of dollars)Carrying Value of the Hedged LiabilitiesCumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Value of the Hedged Liabilities
June 30, 2026December 31, 2025June 30, 2026December 31, 2025
Long-term debt due within one year$501 $602 $1 $3 
Long-term debt due after one year7,519 5,513 (131)(37)
Total$8,020 $6,115 $(130)$(34)
Summary Offsetting Assets and Liabilities
The effect of the net settlement provisions of the master netting agreements on our derivative balances upon an event of default or termination event was as follows:

(Millions of dollars)June 30, 2026December 31, 2025
AssetsLiabilitiesAssetsLiabilities
Gross Amounts Recognized$467 $(370)$496 $(325)
Financial Instruments Not Offset(197)197 (160)160 
Net Amount$270 $(173)$336 $(165)