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HEDGES AND DERIVATIVE FINANCIAL INSTRUMENTS (Tables)

3 Months Ended

Mar. 31, 2022

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Instruments

The following table summarizes our foreign currency denominated debt and foreign exchange forwards/options designated as net investment hedges at March 31, 2022 and December 31, 2021:

						Notional (Local)												Notional (USD)												Current Maturity
Instrument						2022						2021						2022						2021
Foreign exchange forwards/options						MXN	7,200					MXN	7,200					$	362					$	352					August 2022

The following table summarizes our outstanding derivative contracts and their effects in our Consolidated Condensed Balance Sheets at March 31, 2022 and December 31, 2021:

																		Fair Value of
						Notional Amount												Hedge Assets												Hedge Liabilities																		Maximum Term (Months)
Millions of dollars						2022						2021						2022						2021						2022						2021												2022						2021
Derivatives accounted for as hedges(1)
Commodity swaps/options						$	383					$	297					$	67					$	40					$	18					$	13					(CF)						21						21
Foreign exchange forwards/options						2,994						2,872						100						91						143						64						(CF/NI)						119						122
Cross-currency swaps						1,275						1,275						28						31						3						7						(CF)						83						86
Interest rate derivatives						300						300						9						—						—						14						(CF)						38						41
Total derivatives accounted for as hedges																		$	204					$	162					$	164					$	98
Derivatives not accounted for as hedges
Commodity swaps/options						$	1					$	2					$	—					$	—					$	—					$	—					N/A						11						14
Foreign exchange forwards/options						2,552						2,240						31						20						30						18						N/A						9						12
Total derivatives not accounted for as hedges																		31						20						30						18
Total derivatives																		$	235					$	182					$	194					$	116
Current																		$	215					$	170					$	175					$	93
Noncurrent																		20						12						19						23
Total derivatives																		$	235					$	182					$	194					$	116

(1)Derivatives accounted for as hedges are considered either cash flow (CF) or net investment (NI) hedges.

Schedule of Effects of Derivative Instruments on Consolidated Statements of Income

The following tables summarize the effects of derivative instruments on our Consolidated Condensed Statements of Comprehensive Income for the periods presented:

																		Three Months Ended March 31,
																		Gain (Loss) Recognized in OCI (Effective Portion)(2)
Millions of dollars																		2022						2021
Cash flow hedges
Commodity swaps/options																		$	39					$	26
Foreign exchange																		(43)						48
Cross-currency swaps																		8						32
Interest rate derivatives																		23						46
Net investment hedges
Foreign currency																		(16)						7
																		$	11					$	159
																		Three Months Ended March 31,
						Location of Gain (Loss) Reclassified from OCI into Earnings (Effective Portion)												Gain (Loss) Reclassified from OCI into Earnings (Effective Portion)(3)
Cash Flow Hedges - Millions of dollars																		2022						2021
Commodity swaps/options						Cost of products sold												$	18					$	12
Foreign exchange forwards/options						Net sales												—						2
Foreign exchange forwards/options						Cost of products sold												(5)						9
Foreign exchange forwards/options						Interest and sundry (income) expense												29						44
Cross-currency swaps						Interest and sundry (income) expense												41						59
																		$	83					$	126
																		Three Months Ended March 31,
						Location of Gain (Loss) Recognized on Derivatives not Accounted for as Hedges												Gain (Loss) Recognized on Derivatives not Accounted for as Hedges
Derivatives not Accounted for as Hedges - Millions of dollars																		2022						2021
Foreign exchange forwards/options						Interest and sundry (income) expense												$	(16)					$	79

(2)Change in gain (loss) recognized in OCI (effective portion) for the three months ended March 31, 2022 is primarily driven by fluctuations in currency and commodity prices and interest rates compared to prior year. The tax impact of the cash flow hedges was $19 million and $(12) million for the three months ended March 31, 2022 and 2021, respectively. The tax impact of the net investment hedges was $3 million and $(2) million for the three months ended March 31, 2022 and 2021, respectively.

(3)Change in gain (loss) reclassified from OCI into earnings (effective portion) for the three months ended March 31, 2022 was primarily driven by fluctuations in currency and commodity prices and interest rates compared to prior year.

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Tabular disclosure of the location and amount of derivative instruments and nonderivative instruments designated as hedging instruments reported before netting adjustments, and the amount of gain (loss) on derivative instruments and nonderivative instruments designated and qualified as hedging instruments.

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Tabular disclosure of pertinent information about a derivative or group of derivatives on a disaggregated basis, such as for individual instruments, or small groups of similar instruments. May include a combination of the type of instrument, risks being hedged, notional amount, hedge designation, related hedged item, inception date, maturity date, or other relevant item.

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