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Financial Instruments (Tables) | 12 Months Ended
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Dec. 31, 2022
Disclosure of detailed information about financial instruments [abstract] |
Reconciliation of Changes in the Fair Value of Available for Sale Financial Assets |
| 2022 |  | 2021
Fair Value, Beginning of Year | 53 |  | 52
Acquisition (Note 5) | — |  | 1
Changes in Fair Value (1) | 2 |  | —
Fair Value, End of Year | 55 |  | 53
(1) Changes in fair value are recorded in OCI.
Summary of Unrealized Risk Management Positions | Summary of Risk Management Positions
| 2022 |  | 2021
| Risk Management |  | Risk Management
As at December 31, | Asset |  | Liability |  | Net |  | Asset |  | Liability |  | Net
Crude Oil, Natural Gas, Condensate and Refined Products | 2 |  | 40 |  | (38) |  | 46 |  | 116 |  | (70)
Power Swap Contracts | 1 |  | 7 |  | (6) |  | — |  | — |  | —
Renewable Power Contracts | 90 |  | — |  | 90 |  | — |  | — |  | —
Foreign Exchange Rate Contracts | — |  | — |  | — |  | 2 |  | — |  | 2
| 93 |  | 47 |  | 46 |  | 48 |  | 116 |  | (68)
Summary of Fair Value Hierarchy for Risk Management Assets and Liabilities Carried at Fair Value |
As at December 31, | 2022 |  | 2021
Level 2 – Prices Sourced From Observable Data or Market Corroboration | (44) |  | (68)
Level 3 – Prices Sourced From Partially Observable Data | 90 |  | —
| 46 |  | (68)
Reconciliation of Changes in the Fair Value of Cenovus's Risk Management Assets and Liabilities |
| 2022 |  | 2021
Fair Value of Contracts, Beginning of Year | (68) |  | (53)
Acquisition (Note 5) | — |  | (14)
Change in Fair Value of Contracts in Place at Beginning of Year | (5) |  | —
Change in Fair Value of Contracts Entered Into During the Year | (1,641) |  | (995)
Fair Value of Contracts Realized During the Year | 1,762 |  | 993
Unrealized Foreign Exchange Gain (Loss) on U.S. Dollar Contracts | (2) |  | 1
Fair Value of Contracts, End of Year | 46 |  | (68)
Summary of Offsetting Risk Management Positions |
| 2022 |  | 2021
| Risk Management |  | Risk Management
As at December 31, | Asset |  | Liability |  | Net |  | Asset |  | Liability |  | Net
Recognized Risk Management Positions |  |  |  |  |  |  |  |  |  |  |
Gross Amount | 153 |  | 107 |  | 46 |  | 263 |  | 331 |  | (68)
Amount Offset | (60) |  | (60) |  | — |  | (215) |  | (215) |  | —
Net Amount | 93 |  | 47 |  | 46 |  | 48 |  | 116 |  | (68)
Summary of Changes in Inputs to Option Pricing Model, Resulted in Unrealized Gains (Losses) Impacting Earnings Before Income Tax |
As at December 31, 2022 | Sensitivity Range |  | Increase |  | Decrease
WCS Forward Prices | ± $10.00 per barrel |  | (68) |  | 157
WTI Option Volatility | ± ten percent |  | (1) |  | 4
Canadian to U.S. Dollar Foreign Exchange Rate Option Volatility | ± five percent |  | — |  | —
The contingent payment (Level 3) associated with the acquisition of a 50 percent interest in FCCL from ConocoPhillips Company and certain of its subsidiaries ended on May 17, 2022. The final payment was made in July 2022.
As at December 31, 2021 | Sensitivity Range |  | Increase |  | Decrease
WCS Forward Prices | ± $5.00 per barrel |  | (45) |  | 45
The impact of a ten percent increase or decrease in WTI option price volatility and a five percent increase or decrease in the Canadian-U.S. dollar foreign exchange rate options would result in nominal unrealized gains (losses) to earnings before income tax. The impact of fluctuating commodity prices and foreign exchange rates on the Company’s open risk management positions could have resulted in an unrealized gain (loss) impacting earnings before income tax as follows:
As at December 31, 2022 | Sensitivity Range | Increase |  | Decrease
Crude Oil Commodity Price | ± US$10.00/bbl Applied to WTI, Condensate and Related Hedges | 1 |  | (1)
WCS and Condensate Differential Price (1) | ± US$2.50/bbl Applied to Differential Hedges Tied to Production | 13 |  | (13)
WCS (Hardisty) Differential Price | ± US$5.00/bbl Applied to WCS Differential Hedges Tied to Production | (1) |  | 1
Refined Products Commodity Price | ± US$10.00/bbl Applied to Heating Oil and Gasoline Hedges | (2) |  | 2
Natural Gas Basis Price | ± US$0.50/MCF Applied to Natural Gas Basis Hedges | 1 |  | (1)
Power Commodity Price | ± C$20.00/Megawatt Hour Applied to Power Hedges | 113 |  | (113)
U.S. to Canadian Dollar Exchange Rate | ± $0.05 in the U.S. to Canadian Dollar Exchange Rate | 14 |  | (17)
(1) Excludes WCS (Hardisty) differential.
As at December 31, 2021 | Sensitivity Range | Increase |  | Decrease
Crude Oil Commodity Price | ± US$5.00/bbl Applied to WTI, Condensate and Related Hedges | (225) |  | 225
WCS and Condensate Differential Price | ± US$2.50/bbl Applied to WCS and Differential Hedges Tied to Production | 4 |  | (4)
Refined Products Commodity Price | ± US$5.00/bbl Applied to Heating Oil and Gasoline Hedges | (2) |  | 2
U.S. to Canadian Dollar Exchange Rate | ± $0.05 in the U.S. to Canadian Dollar Exchange Rate | 11 |  | (12)
In respect of these financial instruments, the impact of changes in the Canadian per U.S. dollar exchange rate would have resulted in a change to the foreign exchange (gain) loss as follows:
As at December 31, |  | 2022 |  | 2021
$0.05 Increase in the Canadian per U.S. Dollar Foreign Exchange Rate |  | 246 |  | 372
$0.05 Decrease in the Canadian per U.S. Dollar Foreign Exchange Rate |  | (246) |  | (372)
Summary of Earnings Impact of (Gain) Loss from Risk Management Positions | D) Earnings Impact of (Gains) Losses From Risk Management Positions
For the years ended December 31, | 2022 |  | 2021 |  | 2020
Realized (Gain) Loss | 1,762 |  | 993 |  | 252
Unrealized (Gain) Loss (1) | (126) |  | 2 |  | 56
(Gain) Loss on Risk Management | 1,636 |  | 995 |  | 308
(1) All WTI positions related to crude oil sales price risk management were closed by June 30, 2022. In the three months ended June 30, 2022, Cenovus recorded a realized net loss related to these positions of $467 million. Realized and unrealized gains and losses on risk management are recorded in the reportable segment to which the derivative instrument relates.

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