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Derivative Financial Instruments (Tables)
 6 Months Ended
Jun. 30, 2019
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Schedule Of NYMEX Contracts And Butane Price Swap Purchase Agreements
Our open futures contracts at June 30, 2019 were as follows:
Type of Contract/Accounting Methodology
 
Product Represented by the Contract and Associated Barrels
 
Maturity Dates
Futures - Economic Hedges
 
4.3 million barrels of refined products and crude oil
 
Between July 2019 and April 2020
Futures - Economic Hedges
 
1.3 million barrels of butane and natural gasoline
 
Between July 2019 and April 2020
Derivatives and Offset Amounts A schedule of the derivative amounts we have offset and the deposit amounts we could offset under a master netting arrangement are provided below as of December 31, 2018 and June 30, 2019 (in thousands):
Description
 
Gross Amounts of Recognized Assets (Liabilities)
 
Gross Amounts of Assets (Liabilities) Offset in the Consolidated Balance Sheets
 
Net Amounts of Assets (Liabilities) Presented in the Consolidated Balance Sheets
 
Margin Deposit Amounts Not Offset in the Consolidated Balance Sheets
 
Net Asset Amount(1)
As of 12/31/2018
 
$
62,166

 
$
(7,155
)
 
$
55,011

 
$
(37,328
)
 
$
17,683

As of 6/30/2019
 
$
(11,655
)
 
$
2,558

 
$
(9,097
)
 
$
27,533

 
$
18,436

 
 
 
 
 
 
 
 
 
 
 

(1)
Amount represents the maximum loss we would incur if all of our counterparties failed to perform on their derivative contracts.

Basis Derivative Agreement
 
During 2019, we entered into a basis derivative agreement with a joint venture co-owner’s affiliate, and, contemporaneously, that affiliate entered into an intrastate transportation services agreement with the joint venture. Settlements under the basis derivative agreement are determined based on the basis differential of crude oil prices at different market locations and a notional volume of 30,000 barrels per day. As a result, we account for this agreement as a derivative. The agreement will expire in early 2022. We recognize the changes in fair value of this agreement based on forward price curves for crude oil in West Texas and the Houston Gulf Coast currently in other operating income (expense) in our consolidated statements of income. The liability for this agreement at June 30, 2019 was $12.6 million.

Derivative Gains Included in Accumulated Other Comprehensive Loss (AOCL)
The changes in derivative activity included in AOCL for the three and six months ended June 30, 2018 and 2019 were as follows (in thousands):
 
 
Three Months Ended
 
Six Months Ended
 
June 30,
 
June 30,
Derivative Losses Included in AOCL
2018
 
2019
 
2018
 
2019
Beginning balance
$
(27,601
)
 
$
(30,229
)
 
$
(33,755
)
 
$
(26,480
)
Net gain (loss) on cash flow hedges
1,697

 
(6,659
)
 
7,111

 
(11,035
)
Reclassification of net loss on cash flow hedges to income
739

 
601

 
1,479

 
1,228

Ending balance
$
(25,165
)
 
$
(36,287
)
 
$
(25,165
)
 
$
(36,287
)
Derivatives and Hedging-Cash Flow Hedges
The following is a summary of the effect on our consolidated statements of income for the three and six months ended June 30, 2018 and 2019 of derivatives that were designated as cash flow hedges (in thousands):
 
 
Interest Rate Contracts
 
 
Amount of Gain (Loss) Recognized in AOCL on Derivatives
 
Location of Loss Reclassified from AOCL into  Income
 
Amount of Loss Reclassified from AOCL into Income
Three Months Ended June 30, 2018
 
$
1,697

 
Interest expense
 
$
(739
)
Three Months Ended June 30, 2019
 
$
(6,659
)
 
Interest expense
 
$
(601
)

Six Months Ended June 30, 2018
 
$
7,111

 
Interest expense
 
$
(1,479
)
Six Months Ended June 30, 2019
 
$
(11,035
)
 
Interest expense
 
$
(1,228
)
Derivatives and Hedging-Overall-Subsequent Measurement
The following table provides a summary of the effect on our consolidated statements of income for the three and six months ended June 30, 2018 and 2019 of derivatives that were not designated as hedging instruments (in thousands):
 
 
 
 
Amount of Gain (Loss) Recognized on Derivatives
 
 
 
 
Three Months Ended
 
Six Months Ended
 
 
Location of Gain (Loss)
Recognized on Derivatives
 
June 30,
 
June 30,
Derivative Instrument
 
 
2018
 
2019
 
2018
 
2019
Futures contracts
 
Product sales revenue
 
$
(38,411
)
 
$
(4,619
)
 
$
(45,786
)
 
$
(59,130
)
Futures contracts
 
Cost of product sales
 
8,337

 
(6,148
)
 
4,393

 
(3,875
)
Basis derivative agreement
 
Other operating income (expense)
 
—

 
(6,487
)
 
—

 
(4,959
)
 
 
Total
 
$
(30,074
)
 
$
(17,254
)
 
$
(41,393
)
 
$
(67,964
)
Derivatives and Hedging-Designated
The following tables provide a summary of the fair value of derivatives, which are presented on a net basis in our consolidated balance sheets, that were designated as hedging instruments as of December 31, 2018 and June 30, 2019 (in thousands):
 
 
December 31, 2018
 
 
Asset Derivatives
 
Liability Derivatives
Derivative Instrument
 
Balance Sheet Location
 
Fair Value
 
Balance Sheet Location
 
Fair Value
Futures contracts
 
Energy commodity derivatives contracts, net
 
$
462

 
Energy commodity derivatives contracts, net
 
$
—

Interest rate contracts
 
Other current assets
 
312

 
Other current liabilities
 
8,438

 
 
Total
 
$
774

 
Total
 
$
8,438

 
 
 
June 30, 2019
 
 
Asset Derivatives
 
Liability Derivatives
Derivative Instrument
 
Balance Sheet Location
 
Fair Value
 
Balance Sheet Location
 
Fair Value
Interest rate contracts
 
Other current assets
 
$
—

 
Other current liabilities
 
$
11,133


 
The following tables provide a summary of the fair value of derivatives, which are presented on a net basis in our consolidated balance sheets, that were not designated as hedging instruments as of December 31, 2018 and June 30, 2019 (in thousands):
 
 
December 31, 2018
 
 
Asset Derivatives
 
Liability Derivatives
Derivative Instrument
 
Balance Sheet Location
 
Fair Value
 
Balance Sheet Location
 
Fair Value
Futures contracts
 
Energy commodity derivatives contracts, net
 
$
61,704

 
Energy commodity derivatives contracts, net
 
$
7,155

 
 
 
 
 
 
 
 
 
 
 
June 30, 2019
 
 
Asset Derivatives
 
Liability Derivatives
Derivative Instrument
 
Balance Sheet Location
 
Fair Value
 
Balance Sheet Location
 
Fair Value
Futures contracts
 
Energy commodity derivatives contracts, net
 
$
2,558

 
Energy commodity derivatives contracts, net
 
$
11,655

Basis derivative agreement
 
Other current assets
 
—

 
Other current liabilities
 
4,979

Basis derivative agreement
 
Other noncurrent assets
 
—

 
Other noncurrent liabilities
 
7,620

 
 
Total
 
$
2,558

 
Total
 
$
24,254