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Inventories | 9 Months Ended
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Sep. 30, 2020
Inventory Disclosure [Abstract] |
INVENTORIES | 4. INVENTORIES Inventories consisted of the following (in millions):
| September 30, 2020 |  | December 31, 2019
Refinery feedstocks | $ | 1,625 |  |  | $ | 2,399 |
Refined petroleum products and blendstocks | 3,180 |  |  | 4,034 |
Renewable diesel feedstocks and products | 29 |  |  | 46 |
Ethanol feedstocks and products | 240 |  |  | 260 |
Materials and supplies | 283 |  |  | 274 |
Inventories | $ | 5,357 |  |  | $ | 7,013 |
We compare the market value of inventories to their cost on an aggregate basis, excluding materials and supplies. In determining the market value of our inventories, we assume that feedstocks are converted into refined products, which requires us to make estimates regarding the refined products expected to be produced from those feedstocks and the conversion costs required to convert those feedstocks into refined products. We also estimate the usual and customary transportation costs required to move the inventory from our plants to the appropriate points of sale. We then apply an estimated selling price to our inventories. If the aggregate market value is less than the aggregate cost, we recognize a loss for the difference in our statements of income. To the extent the aggregate market value subsequently increases, we recognize an increase to the value of our inventories (not to exceed cost) and a gain in our statements of income. The market value of our LIFO inventory fell below our historical LIFO inventory costs as of March 31, 2020, and as a result, we recorded an LCM inventory valuation reserve of $2.5 billion in order to state our inventories at market. As of September 30, 2020, we reevaluated our inventories and determined that our cost was lower than market. As a result, our LCM inventory valuation reserve was fully reversed as of September 30, 2020. The change in our LCM inventory valuation reserve resulted in a net benefit of $313 million during the three months ended September 30, 2020. The net benefit of $19 million for the nine months ended September 30, 2020 is due to the foreign currency translation effect of the portion of the LCM inventory valuation adjustment attributable to our international operations. As of September 30, 2020, the replacement cost (market value) of LIFO inventories approximated their LIFO carrying amounts. As of December 31, 2019, the market value of LIFO inventories exceeded their LIFO carrying amounts by $2.5 billion. During the three and nine months ended September 30, 2020, we recognized the impact of an expected liquidation of LIFO inventory layers that increased cost of materials and other by $326 million. Our LIFO inventory levels decreased throughout the first nine months of 2020 due to lower production resulting from lower demand for our products caused by the negative economic impacts of COVID-19 on our business. Because these impacts are ongoing, we expect that substantially all of our LIFO inventory levels as of December 31, 2020 will remain below their December 31, 2019 levels. Our non-LIFO inventories accounted for $911 million and $1.4 billion of our total inventories as of September 30, 2020 and December 31, 2019, respectively.

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- Definition The entire disclosure for inventory. Includes, but is not limited to, the basis of stating inventory, the method of determining inventory cost, the classes of inventory, and the nature of the cost elements included in inventory. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 330 -URI http://asc.fasb.org/topic&trid=2126998 + Details
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