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FAIR VALUE MEASUREMENTS (Tables)
 12 Months Ended
Dec. 31, 2018
Fair Value Disclosures [Abstract]  
Recurring Fair Value Measurements
Recurring Fair Value Measurements - The following tables set forth our recurring fair value measurements for the periods indicated:
 
 
December 31, 2018
 
 
Level 1
 
Level 2
 
Level 3
 
Total - Gross
 
Netting (a)
 
Total - Net
 
 
(Thousands of dollars)
Derivative assets
 
 
 
 
 
 
 
 
 
 
 
 
Commodity contracts
 
 
 
 
 
 
 
 
 
 
 
 
Financial contracts
 
$
10,812

 
$
—

 
$
69,165

 
$
79,977

 
$
(32,739
)
 
$
47,238

Physical contracts
 
—

 
—

 
1,142

 
1,142

 
—

 
1,142

Interest-rate contracts
 
—

 
19,005

 
—

 
19,005

 
—

 
19,005

Total derivative assets
 
$
10,812

 
$
19,005

 
$
70,307

 
$
100,124

 
$
(32,739
)
 
$
67,385

 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative liabilities
 
 

 
 

 
 

 
 

 
 

 
 

Commodity contracts
 
 
 
 
 
 
 
 
 
 
 
 
Financial contracts
 
$
(2,916
)
 
$
—

 
$
(29,823
)
 
$
(32,739
)
 
$
32,739

 
$
—

Interest-rate contracts
 
—

 
(99,260
)
 
—

 
(99,260
)
 
—

 
(99,260
)
Total derivative liabilities
 
$
(2,916
)
 
$
(99,260
)
 
$
(29,823
)
 
$
(131,999
)
 
$
32,739

 
$
(99,260
)
(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, 2018, we held no cash and posted $0.8 million of cash with various counterparties, which is included in other current assets in our Consolidated Balance Sheets.

 
 
December 31, 2017
 
 
Level 1
 
Level 2
 
Level 3
 
Total - Gross
 
Netting (a)
 
Total - Net
 
 
(Thousands of dollars)
Derivative assets
 
 
 
 
 
 
 
 
 
 
 
 
Commodity contracts
 
 
 
 
 
 
 
 
 
 
 
 
Financial contracts
 
$
4,252

 
$
—

 
$
20,203

 
$
24,455

 
$
(24,455
)
 
$
—

Interest-rate contracts
 
—

 
49,960

 
—

 
49,960

 
—

 
49,960

Total derivative assets
 
$
4,252

 
$
49,960

 
$
20,203

 
$
74,415

 
$
(24,455
)
 
$
49,960

 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative liabilities
 
 

 
 

 
 

 
 

 
 

 
 

Commodity contracts
 
 
 
 
 
 
 
 
 
 
 
 
Financial contracts
 
$
(5,708
)
 
$
—

 
$
(48,260
)
 
$
(53,968
)
 
$
53,936

 
$
(32
)
Physical contracts
 
—

 
—

 
(4,781
)
 
(4,781
)
 
—

 
(4,781
)
Total derivative liabilities
 
$
(5,708
)
 
$
—

 
$
(53,041
)
 
$
(58,749
)
 
$
53,936

 
$
(4,813
)
(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, 2017, we held no cash and posted $49.7 million of cash with various counterparties, including $29.5 million of cash collateral that is offsetting derivative net liability positions under master-netting arrangements in the table above. The remaining $20.2 million of cash collateral in excess of derivative net liability positions is included in other current assets in our Consolidated Balance Sheets.
Reconciliation of Level 3 Fair Value Measurements
The following table sets forth a reconciliation of our Level 3 fair value measurements for the periods indicated:
 
 
Years Ended
 
 
December 31,
Derivative Assets (Liabilities)
 
2018
 
2017
 
 
(Thousands of dollars)
Net assets (liabilities) at beginning of period
 
$
(32,838
)
 
$
(23,319
)
Total realized/unrealized gains (losses):
 
 
 
 
Included in earnings (a)
 
(140
)
 
212

Included in other comprehensive income (loss) (b)
 
73,462

 
(9,731
)
Net assets (liabilities) at end of period
 
$
40,484

 
$
(32,838
)

(a) - Included in commodity sales revenues in our Consolidated Statements of Income.
(b) - Included in unrealized gains (losses) on derivatives in our Consolidated Statement of Comprehensive Income.