FAIR VALUE MEASUREMENTS
Recurring Fair Value Measurements - The following tables set forth our recurring fair value measurements as of the dates indicated:
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| December 31, 2025 |
| Level 1 | | Level 2 | | Level 3 | | Total - Gross | | Netting (a) | | Total - Net |
| (Millions of dollars) |
| Derivative assets | | | | | | | | | | | |
| Commodity contracts | $ | 60 | | | $ | 69 | | | $ | — | | | $ | 129 | | | $ | (67) | | | $ | 62 | |
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| Total derivative assets | $ | 60 | | | $ | 69 | | | $ | — | | | $ | 129 | | | $ | (67) | | | $ | 62 | |
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| 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.
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| December 31, 2024 |
| Level 1 | | Level 2 | | Level 3 | | Total - Gross | | Netting (a) | | Total - Net |
| (Millions of dollars) |
| Derivative assets | | | | | | | | | | | |
| Commodity contracts | $ | 41 | | | $ | 34 | | | $ | — | | | $ | 75 | | | $ | (72) | | | $ | 3 | |
| Total derivative assets | $ | 41 | | | $ | 34 | | | $ | — | | | $ | 75 | | | $ | (72) | | | $ | 3 | |
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| Derivative liabilities | | | | | | | | | | | |
| Commodity contracts | $ | (40) | | | $ | (46) | | | $ | — | | | $ | (86) | | | $ | 81 | | | $ | (5) | |
| Total derivative liabilities | $ | (40) | | | $ | (46) | | | $ | — | | | $ | (86) | | | $ | 81 | | | $ | (5) | |
(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, 2024, we held no cash and posted cash of $45 million with a counterparty, including $10 million of cash collateral that is offsetting derivative net liability positions under master-netting arrangements in the table above. The remaining $35 million of cash collateral in excess of derivative liability positions 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 information available in the commercial paper market. 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 $32.0 billion and $32.1 billion at December 31, 2025 and 2024, respectively. At December 31, 2025 and 2024, the estimated fair value of our consolidated long-term debt, including current maturities, was $32.7 billion and $31.9 billion, respectively. For comparability to the book value of our consolidated long-term debt, the unamortized debt discounts and issuance costs at December 31, 2025 and 2024, totaled $1.2 billion and $1.1 billion, respectively, which resulted in the estimated fair value, net of unamortized debt discounts and issuance costs, of $31.5 billion and $30.8 billion, 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.