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FAIR VALUE MEASUREMENTS (Tables)
 12 Months Ended
Dec. 31, 2019
Fair Value Disclosures [Abstract]  
Recurring Fair Value Measurements

Recurring Fair Value Measurements - The following tables set forth our recurring fair value measurements for the periods indicated:
 
 
December 31, 2019
 
 
Level 1
 
Level 2
 
Level 3
 
Total - Gross
 
Netting (a)
 
Total - Net
 
 
(Thousands of dollars)
Derivative assets
 
 
 
 
 
 
 
 
 
 
 
 
Commodity contracts
 
 
 
 
 
 
 
 
 
 
 
 
Financial contracts
 
$
10,892

 
$
—

 
$
55,557

 
$
66,449

 
$
(28,588
)
 
$
37,861

Interest-rate contracts
 
—

 
581

 
—

 
581

 
—

 
581

Total derivative assets
 
$
10,892

 
$
581

 
$
55,557

 
$
67,030

 
$
(28,588
)
 
$
38,442

 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative liabilities
 
 
 
 
 
 
 
 
 
 
 
 
Commodity contracts
 
 
 
 
 
 
 
 
 
 
 
 
Financial contracts
 
$
(4,811
)
 
$
—

 
$
(24,785
)
 
$
(29,596
)
 
$
28,588

 
$
(1,008
)
Interest-rate contracts
 
—

 
(201,941
)
 
—

 
(201,941
)
 
—

 
(201,941
)
Total derivative liabilities
 
$
(4,811
)
 
$
(201,941
)
 
$
(24,785
)
 
$
(231,537
)
 
$
28,588

 
$
(202,949
)
(a) - Derivative assets and liabilities are presented in our Consolidated Balance Sheet on a net basis. We net derivative assets and liabilities when a legally enforceable master-netting arrangement exists between the counterparty to a derivative contract and us. At December 31, 2019, we held no cash and posted $8.8 million of cash with various counterparties, which is included in other current assets in our Consolidated Balance Sheet.

 
 
December 31, 2018
 
 
Level 1
 
Level 2
 
Level 3
 
Total - Gross
 
Netting (a)
 
Total - Net
 
 
(Thousands of dollars)
Derivative assets
 
 
 
 
 
 
 
 
 
 
 
 
Commodity contracts
 
 
 
 
 
 
 
 
 
 
 
 
Financial contracts
 
$
10,812

 
$
—

 
$
69,165

 
$
79,977

 
$
(32,739
)
 
$
47,238

Physical contracts
 
—

 
—

 
1,142

 
1,142

 
—

 
1,142

Interest-rate contracts
 
—

 
19,005

 
—

 
19,005

 
—

 
19,005

Total derivative assets
 
$
10,812

 
$
19,005

 
$
70,307

 
$
100,124

 
$
(32,739
)
 
$
67,385

 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative liabilities
 
 

 
 

 
 

 
 

 
 

 
 

Commodity contracts
 
 
 
 
 
 
 
 
 
 
 
 
Financial contracts
 
$
(2,916
)
 
$
—

 
$
(29,823
)
 
$
(32,739
)
 
$
32,739

 
$
—

Interest-rate contracts
 
—

 
(99,260
)
 
—

 
(99,260
)
 
—

 
(99,260
)
Total derivative liabilities
 
$
(2,916
)
 
$
(99,260
)
 
$
(29,823
)
 
$
(131,999
)
 
$
32,739

 
$
(99,260
)
(a) - Derivative assets and liabilities are presented in our Consolidated Balance Sheet on a net basis. We net derivative assets and liabilities when a legally enforceable master-netting arrangement exists between the counterparty to a derivative contract and us. At December 31, 2018, we held no cash and posted $0.8 million of cash with various counterparties, which is included in other current assets in our Consolidated Balance Sheet.
Reconciliation of Level 3 Fair Value Measurements
The following table sets forth a reconciliation of our Level 3 fair value measurements for the periods indicated:
 
 
Years Ended
 
 
December 31,
Derivative Assets (Liabilities)
 
2019
 
2018
 
 
(Thousands of dollars)
Net assets (liabilities) at beginning of period
 
$
40,484

 
$
(32,838
)
Total changes in fair value:
 
 
 
 
Gains (losses) included in net income (a)
 
—

 
(140
)
Settlements included in net income (a)
 
(40,344
)
 
29,141

New Level 3 derivatives included in other comprehensive income (loss) (b)
 
30,627

 
37,106

Unrealized change included in other comprehensive income (loss) (b)
 
5

 
7,215

Net assets (liabilities) at end of period
 
$
30,772

 
$
40,484


(a) - Included in commodity sales revenues/cost of sales and fuel in our Consolidated Statements of Income.
(b) - Included in change in fair value of derivatives in our Consolidated Statements of Comprehensive Income.