COMMODITY DERIVATIVE INSTRUMENTS

12 Months Ended

Dec. 31, 2023

Derivative Instruments and Hedging Activities Disclosure [Abstract]

The Company utilizes derivative instruments to manage its exposure to fluctuations in the underlying commodity prices of its inventory. The Company's management sets and implements hedging policies, including volumes, types of instruments and counterparties, to support oil prices at targeted levels and manage its exposure to fluctuating prices.

The Company’s derivative instruments consist of option and futures arrangements for oil. For option and futures arrangements, the Company receives the difference positive or negative between an agreed-upon strike price and the market price.

The mark-to-market effects of these contracts as of December 31, 2023 and December 31, 2022 are summarized in the following table. The notional amount is equal to the total net volumetric derivative position during the period indicated. The fair value of the crude oil options and future agreements is based on the difference between the strike price and the New York Mercantile Exchange and Brent Complex futures price for the applicable trading months.


December 31, 2023
Contract Type	Contract Period	Weighted Average Trade Price (Barrels)		Remaining Volume (Barrels)	Fair Value
				(in thousands)	(in thousands)
Futures	Dec. 2023-Feb. 2024	$	108.18	1	$	20
Futures	Dec. 2023-Feb. 2024	$	110.33	4	$	(156)
Futures	Dec. 2023-May. 2024	$	77.94	7	$	(63)
Futures	Dec. 2023-May. 2024	$	49.94	60	$	632
Swap	Dec. 2023-Jan. 2024	$	88.39	164	$	(372)
Swap	Dec. 2023-Jan. 2024	$	25.55	100	$	(50)


December 31, 2022
Contract Type	Contract Period	Weighted Average Trade Price (Barrels)		Remaining Volume (Barrels)	Fair Value
				(in thousands)	(in thousands)
Swap	Nov. 2022 - Feb. 2023	$	4.19	5	$	(42)
Swap	Nov. 2022 - Feb. 2023	$	5.51	3	$	(27)
Future	Sept. 2022 - Dec. 2022	$	32.14	25	$	76
Future	Sept. 2022 - Dec. 2022	$	23.57	35	$	(92)
Future	Nov. 2022 - Feb. 2023	$	33.71	10	$	(23)
Futures	Sept. 2022 - Dec. 2022	$	23.75	10	$	30
Futures	Dec. 2022 - Mar. 2023	$	36.08	35	$	(74)
Futures	Dec. 2022 - Apr. 2023	$	35.97	1,000	$	(1,100)
Futures	Dec. 2022 - May. 2023	$	35.81	1,000	$	(1,070)
Futures	Dec. 2022 - Jun. 2023	$	35.60	1,000	$	2,080

The carrying values of the Company's derivatives positions and their locations on the consolidated balance sheets as of December 31, 2023 and 2022 are presented in the table below (in thousands):


Balance Sheet Classification	Contract Type	2023		2022

	Crude oil future	$	652	$	2,186

	Crude oil swaps	(422)		(69)
	Crude oil futures	(219)		(2,359)
Prepaid expenses and other current assets or Accrued expenses and other current liabilities		$	11	$	(242)

For the years ended December 31, 2023, 2022 and 2021, we recognized a $2.9 million gain, and an $88.0 million and $2.3 million loss, respectively, on commodity derivative contracts on the consolidated statements of operations as part of our costs of revenues.