In the normal course of our business, we are exposed to commodity risks related to changes in the prices of crude oil and natural gas as well as changes in interest rates and foreign currency values. In the disclosures that follow, corporate financial risk management activities refer to the mitigation of these risks through hedging activities. We maintain a control environment for all of our financial risk management activities under the direction of our Chief Risk Officer. Our Treasury department is responsible for administering foreign exchange rate and interest rate hedging programs using similar controls and processes, where applicable. Hedging strategies are reviewed annually by the Audit Committee of the Board of Directors.

Corporate Financial Risk Management Activities: Financial risk management activities include transactions designed to reduce risk in the selling prices of crude oil or natural gas we produce or by reducing our exposure to foreign currency or interest rate movements. Generally, futures, swaps or option strategies may be used to fix the forward selling price of a portion of our crude oil or natural gas production. Forward contracts may also be used to purchase certain currencies in which we conduct business with the intent of reducing exposure to foreign currency fluctuations. At December 31, 2018, these forward contracts relate to the British Pound. Interest rate swaps may be used to convert interest payments on certain long-term debt from fixed to floating rates.

Gross notional amounts of both long and short positions are presented in the volume tables beginning below. These amounts include long and short positions that offset in closed positions and have not reached contractual maturity. Gross notional amounts do not quantify risk or represent assets or liabilities of the Corporation, but are used in the calculation of cash settlements under the contracts.

The gross notional amounts of outstanding financial risk management derivative contracts related to WTI instruments as of the dates shown below were as follows:

	December 31, 2018		December 31, 2017
Calendar year program	2019		2018
Instrument type	Puts		Collars
Crude oil volumes (millions of barrels)		34.7		42.0
Ceiling price	N/A		$	65
Floor price	$	60	$	50

At December 31, 2017, we had WTI crude oil price collars for calendar year 2018 with a monthly floor price of $50 per barrel and a monthly ceiling price of $65 per barrel for 115,000 bopd. In the first quarter of 2018, we bought back the WTI $65 call options within the crude oil price collars for the period of May 1, 2018 through December 31, 2018. In 2018, we purchased WTI put options for calendar year 2019 with a WTI monthly floor price of $60 per barrel for 95,000 bopd.

The gross notional amounts of outstanding financial risk management derivative contracts, excluding commodity contracts, were as follows:

The table below reflects the gross and net fair values of risk management derivative instruments and their respective financial statement caption in the Consolidated Balance Sheet:

	Assets		Liabilities
	(In millions)
December 31, 2018
Derivative Contracts Designated as Hedging Instruments
Commodity - Other current assets	$	484	$	—
Interest rate - Other liabilities and deferred credits (noncurrent)		—		(2	)
Total derivative contracts designated as hedging instruments		484		(2	)
Gross fair value of derivative contracts		484		(2	)
Master netting arrangements		—		—
Net Fair Value of Derivative Contracts	$	484	$	(2	)

December 31, 2017
Derivative Contracts Designated as Hedging Instruments
Commodity - Accounts payable	$	—	$	(7	)
Interest rate - Other assets (noncurrent) and Accounts payable		—		(4	)
Total derivative contracts designated as hedging instruments		—		(11	)
Derivative Contracts Not Designated as Hedging Instruments
Commodity - Accounts payable		—		(2	)
Foreign exchange - Accounts receivable: Joint venture and other		1		—
Total derivative contracts not designated as hedging instruments		1		(2	)
Gross fair value of derivative contracts		1		(13	)
Master netting arrangements		—		—
Net Fair Value of Derivative Contracts	$	1	$	(13	)

Impact on statement of consolidated income from derivative contracts designated as hedging instruments:

Crude oil derivatives: In 2018, crude oil price hedging contracts decreased Sales and other operating revenues by $161 million (2017: decrease of $34 million; 2016: $0). At December 31, 2018, pre-tax deferred gains in Accumulated other comprehensive income (loss) related to outstanding crude oil price hedging contracts were $365 million, of which all will be reclassified into earnings during the next 12 months as the hedged crude oil sales are recognized in earnings.

Interest rate swaps designated as fair value hedges: At December 31, 2018, we had interest rate swaps with gross notional amounts of $100 million (2017: $450 million), which were designated as fair value hedges and relate to debt where we have converted interest payments on certain long-term debt from fixed to floating rates. During 2018, we terminated interest rate swaps with a gross notional amount of $350 million and paid $3 million (2017: $0; 2016: $5 million proceeds). See Note 8, Debt. Changes in the fair value of interest rate swaps and the hedged fixed‑rate debt are recorded in Interest expense in the Statement of Consolidated Income. In 2018, the change in fair value of interest rate swaps was an increase in the derivative liability of $1 million (2017: $4 million increase in liability; 2016: $6 million increase in asset) with a corresponding adjustment in the carrying value of the hedged fixed‑rate debt.

Interest rate swaps designated as cash flow hedges: During 2017, HIP entered into interest rate swaps with gross notional amounts totaling $553 million to convert interest payments on certain long-term debt from floating to fixed rates before settling these instruments for a payment of $3 million as part of the refinancing that occurred later in the year. See Note 8, Debt.

Impact on statement of consolidated income from derivative contracts not designated as hedging instruments:

Crude oil collars: In 2018, noncash adjustments to de-designated crude oil price hedging contracts decreased Sales and other operating revenues by $22 million (2017: decrease of $25 million).

Foreign exchange: Total foreign exchange gains and losses were a loss of $5 million in 2018 (2017: gain of $15 million; 2016: gain of $26 million) and are reported in Other, net in Revenues and non-operating income in the Statement of Consolidated Income. A component of foreign exchange gains or losses is the result of foreign exchange derivative contracts that are not designated as hedges, which amounted to a loss of $2 million in 2018 (2017: gain of $3 million; 2016: gain of $62 million).

After‑tax foreign currency translation adjustments included in the Statement of Consolidated Comprehensive Income amounted to gains of $144 million in 2017 and $56 million in 2016. In 2017, $900 million of cumulative currency translation losses were recognized in earnings as a result of the sale of our assets in Norway. See Note 3, Dispositions.

Credit Risk: We are exposed to credit risks that may at times be concentrated with certain counterparties, groups of counterparties or customers. Accounts receivable are generated from a diverse domestic and international customer base. At December 31, 2018, our Accounts receivable were concentrated with the following counterparty industry segments: Financial Institutions — 34%, Integrated companies — 24%, Independent E&P companies — 22%, National oil companies — 7% Refining and marketing companies — 5%, Storage and transportation companies — 3%, and Others — 5%. We reduce risk related to certain counterparties, where applicable, by using master netting arrangements and requiring collateral, generally cash or letters of credit.

At December 31, 2018, we had outstanding letters of credit totaling $284 million (2017: $246 million).

Fair Value Measurement: At December 31, 2018, outstanding total debt, excluding capital leases, was substantially comprised of fixed rate debt instruments with a carrying value of $6,403 million and a fair value of $6,225 million, based on Level 2 inputs in the fair value measurement hierarchy. We also have short-term financial instruments, primarily cash equivalents, accounts receivable and accounts payable, for which the carrying value approximated fair value at December 31, 2018 and December 31, 2017.