Employee Benefit Plans (Tables)

12 Months Ended

Dec. 31, 2016

Compensation and Retirement Disclosure [Abstract]

The changes in benefit obligation, the changes in fair value of plan assets, and the funded status of our pension plans and other postretirement benefit plans

The changes in benefit obligation related to all of our defined benefit plans, the changes in fair value of plan assets^(a), and the funded status of our defined benefit plans as of and for the years ended were as follows (in millions):

	Pension Plans						Other Postretirement Benefit Plans
	December 31,						December 31,
	2016			2015			2016			2015
Changes in benefit obligation:
Benefit obligation as of beginning of year	$	2,365		$	2,450		$	336		$	361
Service cost	111			109			7			8
Interest cost	84			98			12			14
Participant contributions	—			—			8			8
Plan amendments	—			22			—			—
Benefits paid	(130		)	(169		)	(27		)	(27		)
Actuarial (gain) loss	171			(138		)	(35		)	(26		)
Other	(34		)	(7		)	1			(2		)
Benefit obligation as of end of year	$	2,567		$	2,365		$	302		$	336
Changes in plan assets(a):
Fair value of plan assets as of beginning of year	$	1,947		$	1,978		$	—		$	—
Actual return on plan assets	165			19			—			—
Valero contributions	141			126			18			18
Participant contributions	—			—			8			8
Benefits paid	(130		)	(169		)	(27		)	(27		)
Other	(26		)	(7		)	1			1
Fair value of plan assets as of end of year	$	2,097		$	1,947		$	—		$	—
Reconciliation of funded status(a):
Fair value of plan assets as of end of year	$	2,097		$	1,947		$	—		$	—
Less benefit obligation as of end of year	2,567			2,365			302			336
Funded status as of end of year	$	(470	)	$	(418	)	$	(302	)	$	(336	)
Accumulated benefit obligation	$	2,419		$	2,240		n/a			n/a

^{___________________________} 

^(a)  Plan assets include only the assets associated with pension plans subject to legal minimum funding standards. Plan assets associated with U.S. nonqualified pension plans are not included here because they are not protected from our creditors and therefore cannot be reflected as a reduction from our obligations under the pension plans. As a result, the reconciliation of funded status does not reflect the effect of plan assets that exist for all of our defined benefit plans. See Note 18 for the assets associated with certain U.S. nonqualified pension plans.

Schedule of amounts recognized in balance sheet

Amounts recognized in our balance sheet for our pension and other postretirement benefits plans as of December 31, 2016 and 2015 include (in millions):

	Pension Plans						Other Postretirement Benefit Plans
	2016			2015			2016			2015
Deferred charges and other assets, net	$	2		$	5		$	—		$	—
Accrued expenses	(13		)	(20		)	(19		)	(20		)
Other long-term liabilities	(459		)	(403		)	(283		)	(316		)
	$	(470	)	$	(418	)	$	(302	)	$	(336	)

Benefit obligations in excess of fair value of plan assets

The accumulated benefit obligations for certain of our pension plans exceed the fair values of the assets of those plans. For those plans, the table below presents the total projected benefit obligation, accumulated benefit obligation, and fair value of the plan assets (in millions).

	December 31,
	2016		2015
Projected benefit obligation	$	2,322	$	2,169
Accumulated benefit obligation	2,210		2,070
Fair value of plan assets	1,870		1,747

Expected benefit payments

Benefit payments that we expect to pay, including amounts related to expected future services that we expect to receive are as follows for the years ending December 31 (in millions):

	Pension Benefits		Other Postretirement Benefits
2017	$	144	$	19
2018	151		20
2019	205		20
2020	175		20
2021	172		20
2022-2026	985		99

Components of net periodic benefit costs

The components of net periodic benefit cost related to our defined benefit plans were as follows (in millions):

	Pension Plans									Other Postretirement Benefit Plans
	Year Ended December 31,									Year Ended December 31,
	2016			2015			2014			2016			2015			2014
Components of net periodic benefit cost:
Service cost	$	111		$	109		$	120		$	7		$	8		$	7
Interest cost	84			98			91			12			14			15
Expected return on plan assets	(139		)	(133		)	(133		)	—			—			—
Amortization of:
Net actuarial (gain) loss	49			62			35			(1		)	—			(1		)
Prior service credit	(20		)	(22		)	(22		)	(16		)	(18		)	(18		)
Special charges (credits)	(7		)	7			3			—			—			—
Net periodic benefit cost	$	78		$	121		$	94		$	2		$	4		$	3

Pre-tax amounts recognized in other comprehensive income

Pre-tax amounts recognized in other comprehensive income were as follows (in millions):

	Pension Plans									Other Postretirement Benefit Plans
	Year Ended December 31,									Year Ended December 31,
	2016			2015			2014			2016			2015			2014
Net gain (loss) arising during the year:
Net actuarial gain (loss)	$	(145	)	$	24		$	(434	)	$	35		$	26		$	(37	)
Prior service cost	—			(22		)	(1		)	—			—			—
Net (gain) loss reclassified into income:
Net actuarial (gain) loss	49			62			35			(1		)	—			(1		)
Prior service credit	(20		)	(22		)	(22		)	(16		)	(18		)	(18		)
Curtailment and settlement loss	—			7			3			—			—			—
Total changes in other comprehensive income (loss)	$	(116	)	$	49		$	(419	)	$	18		$	8		$	(56	)

Pre-tax amounts in accumulated other comprehensive income not yet recognized

The pre-tax amounts in accumulated other comprehensive (income) loss as of December 31, 2016 and 2015 that have not yet been recognized as components of net periodic benefit cost were as follows (in millions):

	Pension Plans						Other Postretirement Benefit Plans
	2016			2015			2016			2015
Net actuarial (gain) loss	$	878		$	783		$	(66	)	$	(31	)
Prior service credit	(145		)	(166		)	(58		)	(75		)
Total	$	733		$	617		$	(124	)	$	(106	)

Pre-tax amounts in accumulated other comprehensive income to be recognized in the next fiscal year

The following pre-tax amounts included in accumulated other comprehensive (income) loss as of December 31, 2016 are expected to be recognized as components of net periodic benefit cost during the year ending December 31, 2017 (in millions):

	Pension Plans			Other Postretirement Benefit Plans
Amortization of net actuarial (gain) loss	$	53		$	(3	)
Amortization of prior service credit	(20		)	(16		)
Total	$	33		$	(19	)

Weighted-average assumptions used to determine the benefit obligations and net periodic benefit cost

The weighted-average assumptions used to determine the benefit obligations as of December 31, 2016 and 2015 were as follows:

	Pension Plans				Other Postretirement Benefit Plans
	2016		2015		2016		2015
Discount rate	4.08	%	4.45	%	4.26	%	4.53	%
Rate of compensation increase	3.81	%	3.79	%	n/a		n/a

The weighted-average assumptions used to determine the net periodic benefit cost for the years ended December 31, 2016, 2015, and 2014 were as follows:

	Pension Plans						Other Postretirement Benefit Plans
	2016		2015		2014		2016		2015		2014
Discount rate	4.45	%	4.10	%	4.92	%	4.53	%	4.13	%	4.88	%
Expected long-term rate of return on plan assets	7.28	%	7.29	%	7.61	%	n/a		n/a		n/a
Rate of compensation increase	3.79	%	3.78	%	3.81	%	n/a		n/a		n/a

Assumed health care cost trend rates

The assumed health care cost trend rates as of December 31, 2016 and 2015 were as follows:

	2016		2015
Health care cost trend rate assumed for the next year	7.28	%	7.29	%
Rate to which the cost trend rate was assumed to decline (the ultimate trend rate)	5.00	%	5.00	%
Year that the rate reaches the ultimate trend rate	2026		2026

Fair value of pension plan assets by level of fair value hierarchy

The tables below present the fair values of the assets of our pension plans (in millions) as of December 31, 2016 and 2015 by level of the fair value hierarchy. Assets categorized in Level 1 of the hierarchy are measured at fair value using a market approach based on quotations from national securities exchanges. Assets categorized in Level 2 of the hierarchy are measured at net asset value in a market that is not active. As previously noted, we do not fund or fully fund U.S. nonqualified and certain international pension plans that are not subject to funding requirements, and we do not fund our other postretirement benefit plans.

	Fair Value Measurements Using							Total as of December 31, 2016
	Level 1			Level 2		Level 3
Equity securities:
U.S. companies(a)	$	562		$	—	$	—	$	562
International companies	164			—		—		164
Preferred stock	3			—		—		3
Mutual funds:
International growth	90			—		—		90
Index funds(b)	230			—		—		230
Corporate debt instruments	—			280		—		280
Government securities:
U.S. Treasury securities	52			—		—		52
Other government securities	—			158		—		158
Common collective trusts	—			434		—		434
Private funds	—			76		—		76
Insurance contract	—			18		—		18
Interest and dividends receivable	5			—		—		5
Cash and cash equivalents	56			16		—		72
Securities transactions payable, net	(47		)	—		—		(47		)
Total pension assets	$	1,115		$	982	$	—	$	2,097

______________________

See notes on page 108.

	Fair Value Measurements Using							Total as of December 31, 2015
	Level 1			Level 2		Level 3
Equity securities:
U.S. companies(a)	$	503		$	—	$	—	$	503
International companies	158			—		—		158
Preferred stock	2			—		—		2
Mutual funds:
International growth	89			—		—		89
Index funds(b)	202			—		—		202
Corporate debt instruments	—			279		—		279
Government securities:
U.S. Treasury securities	57			—		—		57
Other government securities	—			141		—		141
Common collective trusts	—			375		—		375
Private funds	—			65		—		65
Insurance contract	—			19		—		19
Interest and dividends receivable	5			—		—		5
Cash and cash equivalents	49			43		—		92
Securities transactions payable, net	(40		)	—		—		(40		)
Total pension assets	$	1,025		$	922	$	—	$	1,947

^{__________________________________} 

^(a)  Equity securities are held in a wide range of industrial sectors, including consumer goods, information technology, healthcare, industrials, and financial services.

^(b)  This class includes primarily investments in approximately 50 percent equities and 50 percent bonds as of December 31, 2016. As of December 31, 2015, the class included primarily investments in approximately 60 percent equities and 40 percent bonds.