Derivative Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule Of NYMEX Contracts And Butane Price Swap Purchase Agreements

Our open futures contracts at September 30, 2020 were as follows:

Type of Contract/Accounting Methodology	Product Represented by the Contract and Associated Barrels	Maturity Dates
Futures - Economic Hedges	3.1 million barrels of refined products and crude oil	Between October 2020 and November 2022
Futures - Economic Hedges	0.6 million barrels of gas liquids	Between October and December 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, 2019 and September 30, 2020 (in thousands):

Description	Gross Amounts of Recognized Liabilities		Gross Amounts of Assets Offset in the Consolidated Balance Sheets		Net Amounts of Liabilities Presented in the Consolidated Balance Sheets		Margin Deposit Amounts Not Offset in the Consolidated Balance Sheets		Net Asset Amount(1)
As of 12/31/2019	$	(11,033)	$	811	$	(10,222)	$	27,415	$	17,193
As of 9/30/2020	$	(4,386)	$	2,740	$	(1,646)	$	14,031	$	12,385

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

Derivatives and Hedging-Cash Flow Hedges

The changes in derivative activity included in AOCL for the three and nine months ended September 30, 2019 and 2020 were as follows (in thousands):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
Derivative Losses Included in AOCL	2019		2020		2019		2020
Beginning balance	$	(36,287)	$	(57,748)	$	(26,480)	$	(48,960)
Net loss on cash flow hedges	(14,181)		—		(25,216)		(10,444)
Reclassification of net loss on cash flow hedges to income	699		896		1,927		2,552
Ending balance	$	(49,769)	$	(56,852)	$	(49,769)	$	(56,852)

The following is a summary of the effect on our consolidated statements of income for the three and nine months ended September 30, 2019 and 2020 of derivatives that were designated as cash flow hedges (in thousands):

	Interest Rate Contracts
	Amount of 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 September 30, 2019	$	(14,181)	Interest expense	$	(699)
Three Months Ended September 30, 2020	$	—	Interest expense	$	(896)
Nine Months Ended September 30, 2019	$	(25,216)	Interest expense	$	(1,927)
Nine Months Ended September 30, 2020	$	(10,444)	Interest expense	$	(2,552)

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 nine months ended September 30, 2019 and 2020 of derivatives that were not designated as hedging instruments (in thousands):

		Amount of Gain (Loss) Recognized on Derivatives
		Three Months Ended				Nine Months Ended
	Location of Gain (Loss) Recognized on Derivatives	September 30,				September 30,
Derivative Instrument		2019		2020		2019		2020
Futures contracts	Product sales revenue	$	17,626	$	(7,734)	$	(41,504)	$	89,280
Futures contracts	Cost of product sales	(5,581)		1,815		(9,456)		(2,529)
Basis derivative agreement	Other operating income (expense)	(3,910)		(3,155)		(8,869)		(2,654)
	Total	$	8,135	$	(9,074)	$	(59,829)	$	84,097

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 not designated as hedging instruments as of December 31, 2019 and September 30, 2020 (in thousands):

	December 31, 2019
	Asset Derivatives			Liability Derivatives
Derivative Instrument	Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value
Futures contracts	Commodity derivatives contracts, net	$	811	Commodity derivatives contracts, net	$	11,033
Basis derivative agreement	Other current assets	—		Other current liabilities	8,457
Basis derivative agreement	Other noncurrent assets	—		Other noncurrent liabilities	8,847
	Total	$	811	Total	$	28,337
	September 30, 2020
	Asset Derivatives			Liability Derivatives
Derivative Instrument	Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value
Futures contracts	Commodity derivatives contracts, net	$	1,095	Commodity derivatives contracts, net	$	3,983
Futures contracts	Other noncurrent assets	1,645		Other noncurrent assets	403
Basis derivative agreement	Other current assets	—		Other current liabilities	9,280
Basis derivative agreement	Other noncurrent assets	—		Other noncurrent liabilities	2,994
	Total	$	2,740	Total	$	16,660