Inventories

Inventory consists of the following components:



	December 31,
	2017			2016
	(In thousands)
Crude oil	$	581,417		$	549,886
Other raw materials and unfinished products⁽¹⁾	396,618			287,561
Finished products⁽²⁾	655,336			465,432
Lower of cost or market reserve	(223,833		)	(332,518		)
Process chemicals⁽³⁾	24,792			2,767
Repairs and maintenance supplies and other ⁽⁴⁾	195,762			162,548
Total inventory	$	1,630,092		$	1,135,676


(1)	Other raw materials and unfinished products include feedstocks and blendstocks, other than crude.


(2)	Finished products include gasolines, jet fuels, diesels, lubricants, asphalts, LPG’s and residual fuels.


(3)	Process chemicals include additives and other chemicals.


(4)	Includes RINs

We acquired $214.9 million of other raw materials, unfinished and finished products and repair and maintenance supplies in connection with our February 1, 2017 acquisition of PCLI. We value these inventories at the lower of FIFO cost or net realizable value.

Inventories which are valued at the lower of LIFO cost or market reflect a valuation reserve of $223.8 million and $332.5 million at December 31, 2017 and 2016, respectively. The December 31, 2016 market reserve of $332.5 million was reversed due to the sale of inventory quantities that gave rise to the 2016 reserve. A new market reserve of $223.8 million was established as of December 31, 2017 based on market conditions and prices at that time. The effect of the change in the lower of cost or market reserve was a decrease to cost of goods sold of $108.7 million and $291.9 million for the years ended December 31, 2017 and 2016, respectively, and an increase of $227.0 million for the year ended December 31, 2015.

At December 31, 2017, 2016 and 2015, the LIFO value of inventory, net of the lower of cost or market reserve, was equal to current costs.

In May 2017, the EPA granted the Cheyenne Refinery a one-year small refinery exemption from the Renewable Fuel Standard (“RFS”) program requirements for the 2016 calendar year. As a result, the Cheyenne Refinery’s gasoline and diesel production are not subject to the percentage of production that must satisfy a Renewable Volume Obligation (“RVO”) for 2016. In September 2017, the EPA reinstated the RINs previously submitted to meet our Cheyenne Refinery’s 2016 RVO. The cost of the RINs used earlier to satisfy the Cheyenne Refinery’s 2016 RVO of $30.5 million was charged to cost of products sold in 2016. In the second quarter of 2017, we increased our inventory of RINs and reduced our cost of products sold by this amount, representing the cost of the RINs that were reinstated as a result of the RFS exemption received by the Cheyenne Refinery.

Additionally, in December 2017, the EPA granted the Woods Cross Refinery a one-year small refinery exemption from the RFS program requirements for the 2016 calendar year. In the fourth quarter of 2017, we increased our inventory of RINs and reduced our cost of products sold in the amount of $27.3 million, representing the cost of the RINs to be reinstated as a result of the RFS exemption received by the Woods Cross Refinery. These RINs were reinstated in January 2018.