We use futures, forwards, swaps and options in various markets to meet our customer needs, capture market opportunities and manage foreign exchange currency risk.

Commodity derivative instruments are held at fair value on our consolidated balance sheet. Where these balances have the right of setoff, they are presented on a net basis. Related cash flows are recorded as operating activities on our consolidated statement of cash flows. On our consolidated income statement, gains and losses are recognized either on a gross basis if directly related to our physical business or a net basis if held for trading. Gains and losses related to contracts that meet and are designated with the NPNS exception are recognized upon settlement. We generally apply this exception to eligible crude contracts and certain gas contracts. We do not apply hedge accounting for our commodity derivatives.

The following table presents the gross fair values of our commodity derivatives, excluding collateral, and the line items where they appear on our consolidated balance sheet:


	Millions of Dollars
	September 30 2022		December 31 2021
Assets
Prepaid expenses and other current assets	$	1,675	1,168
Other assets	267		75
Liabilities
Other accruals	1,668		1,160
Other liabilities and deferred credits	220		63


	Millions of Dollars
	Three Months Ended September 30			Nine Months Ended September 30
	2022		2021	2022	2021

Sales and other operating revenues	$	(129)	(483)	(549)	(862)
Other income	(4)		7	(2)	23
Purchased commodities	6		405	352	550

During the first quarter of 2021, we recognized a $305 million loss on settlement of derivative contracts acquired through the Concho transaction. This loss is recorded within the “Sales and other operating revenues” line on our consolidated income statement. In connection with this settlement, we issued a cash payment of $692 million in the first quarter of 2021 and $69 million in the second quarter of 2021 which are included within “Cash Flows From Operating Activities” on our consolidated statement of cash flows.


	Open Position Long (Short)
	September 30 2022	December 31 2021
Commodity
Natural gas and power (billions of cubic feet equivalent)
Fixed price	(18)	4
Basis	(2)	(22)

We invest in financial instruments with maturities based on our cash forecasts for the various accounts and currency pools we manage. The types of financial instruments in which we currently invest include:

The following investments are carried on our consolidated balance sheet at cost, plus accrued interest, and the table reflects remaining maturities at September 30, 2022, and December 31, 2021:


	Millions of Dollars
	Carrying Amount
	Cash and Cash Equivalents			Short-Term Investments
	September 30 2022		December 31 2021	September 30 2022	December 31 2021
Cash	$	664	670
Demand Deposits	1,413		1,554
Time Deposits
1 to 90 days	5,843		2,363	1,591	217
91 to 180 days				137	4
Within one year				34	4
U.S. Government Obligations
1 to 90 days	23		431	—	—
	$	7,943	5,018	1,762	225

The following investments in debt securities classified as available for sale are carried at fair value on our consolidated balance sheet at September 30, 2022, and December 31, 2021:


	Millions of Dollars
	Carrying Amount
	Cash and Cash Equivalents			Short-Term Investments		Investments and Long-Term Receivables
	September 30 2022		December 31 2021	September 30 2022	December 31 2021	September 30 2022	December 31 2021
Major Security Type
Corporate Bonds	$	—	3	322	128	287	173
Commercial Paper	67		7	216	82
U.S. Government Obligations	—		—	101	—	68	2
U.S. Government Agency Obligations				8	2	—	8
Foreign Government Obligations				3	7	7	2
Asset-backed Securities				—	2	118	63
	$	67	10	650	221	480	248


	Millions of Dollars
	Amortized Cost Basis			Fair Value
	September 30 2022		December 31 2021	September 30 2022	December 31 2021
Major Security Type
Corporate Bonds	$	621	305	609	304
Commercial Paper	284		88	283	89
U.S. Government Obligations	172		2	169	2
U.S. Government Agency Obligations	8		10	8	10
Foreign Government Obligations	10		9	10	9
Asset-backed Securities	119		65	118	65
	$	1,214	479	1,197	479

As of September 30, 2022, and December 31, 2021, total unrealized losses for debt securities classified as available for sale with net losses were $17 million and negligible, respectively. No allowance for credit losses has been recorded on investments in debt securities which are in an unrealized loss position.

Proceeds from sales and redemptions of investments in debt securities classified as available for sale were $198 million and $399 million for the three- and nine-month periods ended September 30, 2022, respectively; and $165 million and $485 million for the three- and nine-month periods ended September 30, 2021, respectively. Gross realized gains and losses included in earnings from those sales and redemptions were negligible. The cost of securities sold and redeemed is determined using the specific identification method.

Financial instruments potentially exposed to concentrations of credit risk consist primarily of cash equivalents, short-term investments, long-term investments in debt securities, OTC derivative contracts and trade receivables. Our Cash Equivalents and Short-Term Investments are placed in high-quality commercial paper, government money market funds, U.S. government and government agency obligations, time deposits with major international banks and financial institutions, high-quality corporate bonds, foreign government obligations and asset-backed securities. Our long-term investments in debt securities are placed in high-quality corporate bonds, asset-backed securities, U.S. government and government agency obligations, and foreign government obligations.

The credit risk from our OTC derivative contracts, such as forwards, swaps and options, derives from the counterparty to the transaction. Individual counterparty exposure is managed within predetermined credit limits and includes the use of cash-call margins when appropriate, thereby reducing the risk of significant nonperformance. We also use futures, swaps and option contracts that have a negligible credit risk because these trades are cleared primarily with an exchange clearinghouse and subject to mandatory margin requirements until settled; however, we are exposed to the credit risk of those exchange brokers for receivables arising from daily margin cash calls, as well as for cash deposited to meet initial margin requirements.

Our trade receivables result primarily from our oil and gas operations and reflect a broad national and international customer base, which limits our exposure to concentrations of credit risk. The majority of these receivables have payment terms of 30 days or less, and we continually monitor this exposure and the creditworthiness of the counterparties. We may require collateral to limit the exposure to loss including letters of credit, prepayments and surety bonds, as well as master netting arrangements to mitigate credit risk with counterparties that both buy from and sell to us, as these agreements permit the amounts owed by us or owed to others to be offset against amounts due to us.

Certain of our derivative instruments contain provisions that require us to post collateral if the derivative exposure exceeds a threshold amount. We have contracts with fixed threshold amounts and other contracts with variable threshold amounts that are contingent on our credit rating. The variable threshold amounts typically decline for lower credit ratings, while both the variable and fixed threshold amounts typically revert to zero if we fall below investment grade. Cash is the primary collateral in all contracts; however, many also permit us to post letters of credit as collateral, such as transactions administered through the New York Mercantile Exchange.

The aggregate fair value of all derivative instruments with such credit risk-related contingent features that were in a liability position at September 30, 2022 and December 31, 2021, was $377 million and $281 million, respectively. For these instruments, collateral posted at September 30, 2022, was $4 million and no collateral was posted at December 31, 2021. If our credit rating had been downgraded below investment grade at September 30, 2022, we would have been required to post $314 million of additional collateral, either with cash or letters of credit.