Derivative Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2013

Derivative Instruments And Hedging Activities Disclosure [Abstract]

Outstanding Foreign Currency Forward Contracts

The Company had the following outstanding foreign currency forward contracts that were entered into to hedge nonfunctional currency cash flows from forecasted revenues and expenses (in millions):


	Currency Denomination
Foreign Currency	June 30, 2013			December 31, 2012
Norwegian Krone		NOK	9,440	NOK	6,281
U.S. Dollar		$	509	$	331
Euro		€	376	€	389
Danish Krone		DKK	195	DKK	134
British Pound Sterling		£	34	£	6
Singapore Dollar		SGD	16	SGD	14

The Company had the following outstanding foreign currency forward contracts that hedge the fair value of nonfunctional currency monetary accounts (in millions):


	Currency Denomination
Foreign Currency	June 30, 2013		December 31, 2012
Norwegian Krone	NOK	2,979	NOK	1,684
Russian Ruble	RUB	1,841	RUB	1,467
U.S. Dollar	$	941	$	967
Euro	€	191	€	225
Danish Krone	DKK	183	DKK	177
Brazilian Real	BRL	172	BRL	135
Singapore Dollar	SGD	16	SGD	24
British Pound Sterling	£	11	£	9
Swedish Krone	SEK	1	SEK	5

Derivative Instruments and their Balance Sheet Classifications

The Company has the following gross fair values of its derivative instruments and their balance sheet classifications:

NATIONAL OILWELL VARCO, INC.

Fair Values of Derivative Instruments

(In millions)


	Asset Derivatives					Liability Derivatives
		Fair Value					Fair Value
	Balance Sheet Location	June 30, 2013		December 31, 2012		Balance Sheet Location	June 30, 2013		December 31, 2012
Derivatives designated as hedging instruments under ASC Topic 815
Foreign exchange contracts	Prepaid and other current assets	$	12	$	57	Accrued liabilities	$	32	$	5
Foreign exchange contracts	Other Assets		2		24	Other Liabilities		15		1

Total derivatives designated as hedging instruments under ASC Topic 815		$	14	$	81		$	47	$	6

Derivatives not designated as hedging instruments under ASC Topic 815
Foreign exchange contracts	Prepaid and other current assets	$	20	$	24	Accrued liabilities	$	27	$	13

Total derivatives not designated as hedging instruments under ASC Topic 815		$	20	$	24		$	27	$	13

Total derivatives		$	34	$	105		$	74	$	19

Effect of Derivative Instruments on Consolidated Statements of Income

The Effect of Derivative Instruments on the Consolidated Statements of Income

($ in millions)


Derivatives in ASC Topic 815 Cash Flow Hedging Relationships	Amount of Gain (Loss) Recognized in OCI on Derivative (Effective Portion) (a)						Location of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)	Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion)						Location of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)	Amount of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing) (b)
	Six Months Ended June 30,							Six Months Ended June 30,							Six Months Ended June 30,
	2013			2012				2013			2012				2013		2012
							Revenue		4			(6	)
Foreign exchange contracts		(95	)		(5	)	Cost of revenue		(1	)		(11	)	Other income (expense), net		5		4

Total		(95	)		(5	)			3			(17	)			5		4


Derivatives Not Designated as Hedging Instruments under ASC Topic 815	Location of Gain (Loss) Recognized in Income on Derivative	Amount of Gain (Loss) Recognized in Income on Derivative
		Six Months Ended June 30,
		2013		2012
Foreign exchange contracts	Other income (expense), net		12		13

Total			12		13

(a)	The Company expects that $24 million of the Accumulated Other Comprehensive Income (Loss) will be reclassified into earnings within the next twelve months with an offset by gains from the underlying transactions resulting in no impact to earnings or cash flow.

(b)

The amount of gain (loss) recognized in income represents nil and $(1) million related to the ineffective portion of the hedging relationships for the six months ended June 30, 2013 and 2012, respectively, and $5 million related to the amount excluded from the assessment of the hedge effectiveness for each of the six months ended June 30, 2013 and 2012, respectively.