Employee Benefits

6 Months Ended

Jun. 30, 2020

Retirement Benefits [Abstract]

Employee Benefits

Employee Benefits

Chevron has defined benefit pension plans for many employees. The company typically prefunds defined benefit plans as required by local regulations or in certain situations where prefunding provides economic advantages. In the United States, all qualified plans are subject to the Employee Retirement Income Security Act minimum funding standard. The company does not typically fund U.S. nonqualified pension plans that are not subject to funding requirements under laws and regulations because contributions to these pension plans may be less economic and investment returns may be less attractive than the company’s other investment alternatives.

The company also sponsors other postretirement employee benefit (OPEB) plans that provide medical and dental benefits, as well as life insurance for some active and qualifying retired employees. The plans are

unfunded, and the company and the retirees share the costs. For the company’s main U.S. medical plan, the increase to the pre-Medicare company contribution for retiree medical coverage is limited to no more than 4 percent each year. Certain life insurance benefits are paid by the company.

The components of net periodic benefit costs for 2020 and 2019 are as follows:

	Three Months Ended June 30					Six Months Ended June 30
	2020		2019			2020		2019
	(Millions of dollars)				(Millions of dollars)
Pension Benefits
United States
Service cost	$	125	$	102		$	249	$	203
Interest cost	88		99			176		198
Expected return on plan assets	(163)		(141)			(325)		(282)
Amortization of prior service costs (credits)	—		1			1		1
Amortization of actuarial losses (gains)	96		59			192		119
Settlement losses	60		60			120		120
Total United States	206		180			413		359
International
Service cost	32		36			64		71
Interest cost	44		53			87		104
Expected return on plan assets	(51)		(57)			(103)		(115)
Amortization of prior service costs (credits)	3		3			5		6
Amortization of actuarial losses (gains)	11		6			21		11
Settlement losses	—		—			—		1
Total International	39		41			74		78
Net Periodic Pension Benefit Costs	$	245	$	221		$	487	$	437
Other Benefits*
Service cost	$	10	$	9		$	19	$	18
Interest cost	17		24			35		48
Amortization of prior service costs (credits)	(8)		(7)			(14)		(14)
Amortization of actuarial losses (gains)	2		—			2		(1)
Net Periodic Other Benefit Costs	$	21	$	26		$	42	$	51

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* Includes costs for U.S. and international OPEB plans. Obligations for plans outside the United States are not significant relative to the company’s total OPEB obligation.

Through June 30, 2020, a total of $531 million was contributed to employee pension plans (including $411 million to the U.S. plans). Contribution amounts are dependent upon plan investment returns, changes in pension obligations, regulatory requirements and other economic factors. Additional funding may ultimately be required if investment returns are insufficient to offset increases in plan obligations.

During the first six months of 2020, the company contributed $82 million to its OPEB plans. The company anticipates contributing approximately $92 million during the remainder of 2020.