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Fair Value Measurements | 12 Months Ended
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Dec. 31, 2023
Fair Value Disclosures [Abstract] |
Fair Value Measurements | (11) Fair Value Measurements In accordance with FASB ASC Topic 820, Fair Value Measurements and Disclosures (“Topic 820”), certain assets and liabilities of the Company are measured at fair value on a recurring and nonrecurring basis at December 31, 2023 and 2022. Topic 820 utilizes a fair value hierarchy considering the inputs and valuation techniques used to measure fair value into the following three broad levels: •Level 1 — Quoted prices in active markets for identical assets or liabilities. •Level 2 — Observable inputs other than quoted prices included within Level 1 for the asset or liability either directly or indirectly, which include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets and liabilities in markets that are not active. •Level 3 — Unobservable inputs that are significant to the fair value of the asset or liability, which include valuation techniques that involve significant unobservable inputs and Company’s own assumptions of market inputs/valuation. Assets and liabilities measured at fair value on a recurring basis The following tables set forth information about the assets and liabilities measured at fair value on a recurring basis, by input level, as of December 31, 2023 and 2022. Such amounts are presented on a gross basis, before the effects of netting and allocation of collateral. The Company elected to offset the fair value amounts recognized for derivative assets and liabilities executed with the same counterparty under a master netting arrangement, including fair value amounts recognized for the right to reclaim or the obligation to return cash collateral.
| December 31, 2023
| Fair Value Hierarchy |  | Total gross fair value |  | Contract netting |  | Collateral netting (1) |  | Net value
(in millions) | Level 1 |  | Level 2 |  | Level 3 |  |  |  |
Assets |  |  |  |  |  |  |  |  |  |  |  |  |
Commodity derivative instruments | $ | — |  |  | $ | 31 |  |  | $ | — |  |  | $ | 31 |  |  | $ | (6) |  |  | $ | — |  |  | $ | 25 |
Liabilities |  |  |  |  |  |  |  |  |  |  |  |  |
Commodity derivative instruments | — |  |  | (6) |  |  | — |  |  | (6) |  |  | 6 |  |  | — |  |  | — |
RFS | — |  |  | (329) |  |  | — |  |  | (329) |  |  | — |  |  | — |  |  | (329) |
| December 31, 2022
| Fair Value Hierarchy |  | Total gross fair value |  | Contract netting |  | Collateral netting (1) |  | Net value
| Level 1 |  | Level 2 |  | Level 3 |  |  |  |
Assets |  |  |  |  |  |  |  |  |  |  |  |  |
Commodity derivative instruments | $ | — |  |  | $ | 4 |  |  | $ | — |  |  | $ | 4 |  |  | $ | (4) |  |  | $ | — |  |  | $ | — |
Liabilities |  |  |  |  |  |  |  |  |  |  |  |  |
Commodity derivative instruments | — |  |  | (9) |  |  | — |  |  | (9) |  |  | 4 |  |  | 1 |  |  | (4) |
RFS | — |  |  | (692) |  |  | — |  |  | (692) |  |  | — |  |  | — |  |  | (692) |
(1)At December 31, 2023 and 2022, the Company had $13 million and $7 million of collateral under master netting arrangements not offset against the derivatives within Prepaid expenses and other current assets on the Consolidated Balance Sheets, respectively, primarily related to initial margin requirements. The Petroleum Segment’s commodity derivative contracts consist of exchange traded futures, commodity price swaps, and sale and purchase forwards that are measured at fair value using a market approach based on available broker quoted market prices of identical or similar instruments. Similarly, RFS obligations are measured at fair value using a market approach based on available broker quoted market RIN prices for each specific or closest vintage year. The Company had no transfers of assets or liabilities between any of the above levels during the years ended December 31, 2023 and 2022. Assets and liabilities measured at fair value on a nonrecurring basis CVR Partners performed a nonrecurring fair value measurement of the equity interest received as part of the 45Q Transaction in the first quarter of 2023. Such valuation used a combination of the market approach and the discounted cash flow methodology with key inputs including the discount rate, contractual and expected future cash flows, and market multiples. CVR Partners determined the estimated fair value of the consideration received to be $46 million, which is a nonrecurring Level 3 measurement, as defined by Topic 820, based on the use of CVR Partners’ own assumptions described above. There are no other assets or liabilities that were measured at fair value on a nonrecurring basis as of December 31, 2023 and 2022. Assets and liabilities not required to be measured at fair value CVR Energy holds cash equivalents which consist primarily of bank time deposits with maturities of 90 days or less. Cash and cash equivalents and reserved funds had carrying and fair values of $1.2 billion and $510 million at December 31, 2023 and 2022, respectively, and are classified as Level 1 in the fair value hierarchy. Long-term debt of $2.1 billion and $1.5 billion at December 31, 2023 and 2022, respectively, had estimated fair values of $2.1 billion and$1.4 billion, respectively, and are classified as Level 2 in the fair value hierarchy. Other short-term financial assets and liabilities, which consist of reserved funds, restricted cash, accounts receivable, accounts payable, and operating and finance lease obligations, are carried at cost on the Consolidated Balance Sheets and approximate their estimated fair values.

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- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482106/820-10-50-2 + Details
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