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Hedging Activities
 12 Months Ended
Dec. 31, 2016
Hedging Activities

NOTE 10—HEDGING ACTIVITIES

Fuel Derivatives

As of December 31, 2016, the Company did not have any fuel hedging contracts outstanding to hedge its fuel consumption. The last of the Company’s fuel hedge derivatives designated for cash flow hedge accounting expired in December 2016. The Company’s current strategy is to not enter into transactions to hedge its fuel consumption, although the Company regularly reviews its strategy based on market conditions and other factors.

The Company records each derivative instrument as a derivative asset or liability (on a gross basis) in its consolidated balance sheets, and, accordingly, records any related collateral on a gross basis. The table below presents the fair value amounts of fuel derivative assets and liabilities and the location of amounts recognized in the Company’s financial statements.

At December 31, the Company’s derivatives were reported in its consolidated balance sheets as follows (in millions):

 

Classification

   

Balance Sheet Location

        2016              2015      

Derivatives designated as cash flow hedges

         

Liabilities:

         

Fuel contracts due within one year

    Fuel derivative instruments     $         —        $ 119   

Derivatives not designated for hedge accounting

         

Liabilities:

         

Fuel contracts due within one year

    Fuel derivative instruments     $ —        $ 5   

Total derivatives

         
     

 

 

     

 

 

  

Total liabilities

        $ —        $ 124   
     

 

 

     

 

 

  

 

The following tables present the fuel hedge gains (losses) recognized during the periods presented and their classification in the financial statements (in millions):

Derivatives designated as cash flow hedges

 

     Amount of  Loss
Recognized
in AOCI on Derivatives
(Effective Portion)		      Loss Reclassified from
AOCI into Income
(Fuel Expense)
(Effective Portion)		      Amount of Loss
Recognized in
Nonoperating income
(expense):  Miscellaneous,
net (Ineffective Portion)		  
             2016                      2015                      2016                      2015                      2016                      2015          

Fuel contracts

     $ (4)        $ (320)        $ (217)        $ (604)        $ —         $ —    

Derivatives not designated for hedge accounting

 

     Amount of Loss Recognized
in Nonoperating income (expense):
Miscellaneous, net		       
             2016                      2015                     2014               

Fuel contracts

     $ —        $ (80 )     $ (462)      

Foreign Currency Derivatives

As of December 31, 2016, the Company did not have any foreign currency contracts outstanding to hedge its foreign currency sales. The last of the Company’s foreign currency derivatives designated for cash flow hedge accounting expired in December 2016. The Company’s current strategy is to not enter into transactions to hedge its foreign currency sales, although the Company regularly reviews its strategy based on market conditions and other factors.