Hedges and Derivative Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2019

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Instruments

The following table summarizes our outstanding derivative contracts and their effects on our Consolidated Balance Sheets at December 31, 2019 and 2018:

					Fair Value of								Type of Hedge (1)
	Notional Amount				Hedge Assets				Hedge Liabilities					Maximum Term (Months)
Millions of dollars	2019		2018		2019		2018		2019		2018			2019	2018
Derivatives accounted for as hedges
Commodity swaps/options	$	174	$	216	$	4	$	1	$	10	$	27	(CF)	21	30
Foreign exchange forwards/options	3,177		3,126		94		49		84		48		(CF/NI)	32	44
Cross-currency swaps	1,275		—		25		—		23		—		(CF)	110	0
Interest rate derivatives	300		—		6		—		—		—		(CF)	65	0
Total derivatives accounted for as hedges					$	129	$	50	$	117	$	75
Derivatives not accounted for as hedges
Commodity swaps/options	$	1	$	3	$	—	$	—	$	—	$	—	N/A	7	0
Foreign exchange forwards/options	3,182		4,382		15		27		22		69		N/A	12	21
Total derivatives not accounted for as hedges					$	15	$	27	$	22	$	69
Total derivatives					$	144	$	77	$	139	$	144
Current					$	55	$	60	$	61	$	95
Noncurrent					89		17		78		49
Total derivatives					$	144	$	77	$	139	$	144

⁽¹⁾ Derivatives accounted for as hedges are considered either cash flow (CF) or net investment (NI) hedges.

The following table summarizes our foreign currency denominated debt and foreign exchange forwards/options designated as net investment hedges at December 31, 2019 and 2018:

	Notional (local)				Notional (USD)				Current Maturity
Instrument	2019		2018		2019		2018
Senior note - 0.625%	€	500	€	500	$	561	$	573	March 2020
Foreign exchange forwards/options	MXN 7,200		MXN 7,200		$	382	$	366	August 2022

Schedule of Effects of Derivative Instruments on Consolidated Statements of Income

The following tables summarize the effects of derivative instruments on our Consolidated Statements of Income (Loss) and Consolidated Statements of Comprehensive Income (Loss) for the years ended December 31, 2019 and 2018:

		Gain (Loss) Recognized in OCI (Effective Portion) (2)
Cash Flow Hedges - Millions of dollars		2019			2018
Commodity swaps/options		$	(4	)	$	(51	)
Foreign exchange forwards/options		60			131
Cross-currency swaps		9			—
Interest rate derivatives		6			(3		)
Net Investment Hedges
Foreign currency		5			23
		$	76		$	100
	Location of Gain (Loss) Reclassified from OCI into Earnings (Effective Portion)	Gain (Loss) Reclassified from OCI into Earnings (Effective Portion)
Cash Flow Hedges - Millions of dollars		2019			2018
Commodity swaps/options (3)	Cost of products sold	$	(22	)	$	22
Foreign exchange forwards/options	Net sales	(4		)	(3		)
Foreign exchange forwards/options	Cost of products sold	16			(5		)
Foreign exchange forwards/options	Interest and sundry (income) expense	73			94
Cross-currency swaps	Interest and sundry (income) expense	26			—
Interest rate derivatives	Interest expense	(1		)	(1		)
		$	88		$	107
	Location of Gain (Loss) Recognized on Derivatives not Accounted for as Hedges	Gain (Loss) Recognized on Derivatives not Accounted for as Hedges (3)
Derivatives not Accounted for as Hedges - Millions of dollars		2019			2018
Foreign exchange forwards/options	Interest and sundry (income) expense	$	30		$	19

⁽²⁾ The tax impact of the cash flow hedges was $4 million and $7 million in 2019 and 2018, respectively. The tax impact of the net investment hedges was $2 million and $(15) million in 2019 and 2018, respectively.

⁽³⁾ Cost for commodity swaps/options are recognized in cost of sales as products are sold.