Our operations expose us to a variety of risks including but not limited to changes in the prices of commodities that we buy or sell, changes in interest rates, and the creditworthiness of each of our counterparties. We manage certain of these exposures with either physical or financial transactions. We have established a comprehensive risk management policy and a risk management committee (the “Risk Management Committee”), to monitor and manage market risks associated with commodity prices and counterparty credit. The Risk Management Committee is composed of senior executives who receive regular briefings on positions and exposures, credit exposures and overall risk management in the context of market activities. The Risk Management Committee is responsible for the overall management of credit risk and commodity price risk, including monitoring exposure limits.

As of September 30, 2020, we had cash deposits of $21 million, included in collateral cash deposits in our condensed consolidated balance sheets. Additionally, as of September 30, 2020, we held letters of credit of $51 million from counterparties to secure their future performance under financial or physical contracts. Collateral amounts held or posted may be fixed or may vary, depending on the value of the underlying contracts, and could cover normal purchases and sales, services, trading and hedging contracts. In many cases, we and our counterparties have publicly disclosed credit ratings, which may impact the amounts of collateral requirements.

Physical forward contracts and financial derivatives are generally cash settled at the expiration of the contract term. These transactions are generally subject to specific credit provisions within the contracts that would allow the seller, at its discretion, to suspend deliveries, cancel agreements or continue deliveries to the buyer after the buyer provides security for payment satisfactory to the seller.

Certain of our derivative instruments are subject to a master netting or similar arrangement, whereby we may elect to settle multiple positions with an individual counterparty through a single net payment. Each of our individual derivative instruments are presented on a gross basis on the condensed consolidated balance sheets, regardless of our ability to net settle our positions. Instruments that are governed by agreements that include net settle provisions allow final settlement, when presented with a termination event, of outstanding amounts by extinguishing the mutual debts owed between the parties in exchange for a net amount due. We have trade receivables and payables associated with derivative instruments, subject to master netting or similar agreements, which are not included in the table below. The following summarizes the gross and net amounts of our derivative instruments:


	September 30, 2020						December 31, 2019
	Gross Amounts of Assets and (Liabilities) Presented in the Balance Sheet		Amounts Not Offset in the Balance Sheet - Financial Instruments		Net Amount		Gross Amounts of Assets and (Liabilities) Presented in the Balance Sheet		Amounts Not Offset in the Balance Sheet - Financial Instruments		Net Amount
	(millions)
Assets:
Commodity derivatives	$	131	$	—	$	131	$	34	$	—	$	34

Liabilities:
Commodity derivatives	$	(112)	$	—	$	(112)	$	(78)	$	—	$	(78)

The fair value of our derivative instruments that are marked-to-market each period, as well as the location of each within our condensed consolidated balance sheets, by major category, is summarized below. We have no derivative instruments that are designated as hedging instruments for accounting purposes as of September 30, 2020 and December 31, 2019.


Balance Sheet Line Item	September 30, 2020		December 31, 2019		Balance Sheet Line Item	September 30, 2020		December 31, 2019
	(millions)					(millions)









Derivative Assets Not Designated as Hedging Instruments:					Derivative Liabilities Not Designated as Hedging Instruments:
Commodity derivatives:					Commodity derivatives:
Unrealized gains on derivative instruments — current	$	91	$	32	Unrealized losses on derivative instruments — current	$	(83)	$	(58)
Unrealized gains on derivative instruments — long-term	40		2		Unrealized losses on derivative instruments — long-term	(29)		(20)
Total	$	131	$	34	Total	$	(112)	$	(78)

The following summarizes the balance and activity within AOCI relative to our interest rate, commodity and foreign currency cash flow hedges as of and for the three months ended September 30, 2020:


	Interest Rate Cash Flow Hedges		Commodity Cash Flow Hedges		Foreign Currency Cash Flow Hedges (a)		Total
	(millions)
Net deferred (losses) gains in AOCI (beginning balance)	$	(2)	$	(6)	$	1	$	(7)

Net deferred (losses) gains in AOCI (ending balance)	$	(2)	$	(6)	$	1	$	(7)
Deferred losses in AOCI expected to be reclassified into earnings over the next 12 months	$	(1)	$	—	$	—	$	(1)

The following summarizes the balance and activity within AOCI relative to our interest rate, commodity and foreign currency cash flow hedges as of and for the nine months ended September 30, 2020:


	Interest Rate Cash Flow Hedges		Commodity Cash Flow Hedges		Foreign Currency Cash Flow Hedges (a)		Total
	(millions)
Net deferred (losses) gains in AOCI (beginning balance)	$	(2)	$	(6)	$	1	$	(7)

Net deferred (losses) gains in AOCI (ending balance)	$	(2)	$	(6)	$	1	$	(7)
Deferred losses in AOCI expected to be reclassified into earnings over the next 12 months	$	(1)	$	—	$	—	$	(1)

The following summarizes the balance and activity within AOCI relative to our interest rate, commodity and foreign currency cash flow hedges as of and for the three months ended September 30, 2019:


	Interest Rate Cash Flow Hedges		Commodity Cash Flow Hedges		Foreign Currency Cash Flow Hedges (a)		Total
	(millions)
Net deferred (losses) gains in AOCI (beginning balance)	$	(3)	$	(6)	$	1	$	(8)

Net deferred (losses) gains in AOCI (ending balance)	$	(3)	$	(6)	$	1	$	(8)

The following summarizes the balance and activity within AOCI relative to our interest rate, commodity and foreign currency cash flow hedges as of and for the nine months ended September 30, 2019:


	Interest Rate Cash Flow Hedges		Commodity Cash Flow Hedges		Foreign Currency Cash Flow Hedges (a)		Total
	(millions)
Net deferred (losses) gains in AOCI (beginning balance)	$	(3)	$	(6)	$	1	$	(8)

Net deferred (losses) gains in AOCI (ending balance)	$	(3)	$	(6)	$	1	$	(8)

For the nine months ended September 30, 2020 and 2019, no derivative losses attributable to the ineffective portion or to amounts excluded from effectiveness testing were recognized in trading and marketing gains or losses, net or interest expense in our condensed consolidated statements of operations. For the nine months ended September 30, 2020 and 2019, no derivative losses were reclassified from AOCI to trading and marketing gains or losses, net or interest expense as a result of the discontinuance of cash flow hedges related to certain forecasted transactions that are not probable of occurring.

Changes in the value of derivative instruments, for which the hedge method of accounting has not been elected from one period to the next, are recorded in the condensed consolidated statements of operations. The following summarizes these amounts and the location within the condensed consolidated statements of operations that such amounts are reflected:


Commodity Derivatives: Statements of Operations Line Item	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
	(millions)
Realized gains	$	22	$	25	$	90	$	42
Unrealized (losses) gains	(11)		(26)		66		(41)
Trading and marketing gains (losses), net	$	11	$	(1)	$	156	$	1

The following tables represent, by commodity type, our net long or short positions that are expected to partially or entirely settle in each respective year. To the extent that we have long dated derivative positions that span multiple calendar years, the contract will appear in more than one line item in the tables below.