Inventories (Notes)

3 Months Ended

Mar. 31, 2022

INVENTORIES

Inventories consist principally of natural gas held in storage, NGLs and refined products, crude oil and spare parts, all of which are valued at the lower of cost or net realizable value utilizing the weighted-average cost method.

Sunoco LP’s fuel inventories are stated at the lower of cost or market using the last-in, first-out (“LIFO”) method. As of March 31, 2022 and December 31, 2021, the carrying value of Sunoco LP’s fuel inventory included lower of cost or market reserves of zero and $121 million, respectively. The fuel inventory replacement cost was $112 million higher than the fuel inventory balance as of March 31, 2022. For the three months ended March 31, 2022 and 2021, the Partnership’s consolidated income statements did not include any material amounts of income from the liquidation of Sunoco LP’s LIFO fuel inventory. For the three months ended March 31, 2022 and 2021, the Partnership’s cost of products sold included favorable inventory adjustments of $120 million and $100 million, respectively, related to Sunoco LP’s LIFO inventory.


	March 31, 2022		December 31, 2021
Natural gas, NGLs and refined products	$	1,379	$	1,259
Crude oil	171		328
Spare parts and other	431		427
Total inventories	$	1,981	$	2,014

We utilize commodity derivatives to manage price volatility associated with our natural gas inventory. Changes in fair value of designated hedged inventory are recorded in inventory on our consolidated balance sheets and cost of products sold in our consolidated statements of operations.