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Derivative Financial Instruments | 12 Months Ended
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Dec. 31, 2025
Derivative Financial Instruments |
Derivative Financial Instruments | Note 10. Derivative Financial Instruments The following table summarizes the notional values related to the Partnership’s derivative instruments outstanding at December 31, 2025:
​ | ​ | ​ | ​ | ​ | ​
​ | Units (1) | ​ ​ ​ | Unit of Measure |
Exchange-Traded Derivatives | ​ | ​ | ​ | ​ | ​
Long | ​ | 66,108 |  | Thousands of barrels | ​
Short | ​ | (68,441) |  | Thousands of barrels | ​
​ | ​ | ​ | ​ | ​ | ​
OTC Derivatives (Petroleum/Ethanol) | ​ | ​ | ​ | ​ | ​
Long | ​ | 10,866 |  | Thousands of barrels | ​
Short | ​ | (9,917) |  | Thousands of barrels | ​
(1) | Number of open positions and gross notional values do not measure the Partnership’s risk of loss, quantify risk or represent assets or liabilities of the Partnership, but rather indicate the relative size of the derivative instruments and are used in the calculation of the amounts to be exchanged between counterparties upon settlements.
Derivatives Accounted for as Hedges Fair Value Hedges The Partnership’s fair value hedges include exchange-traded futures contracts and OTC derivative contracts that are hedges against inventory with specific futures contracts matched to specific barrels. The change in fair value of these futures contracts and the change in fair value of the underlying inventory generally provide an offset to each other in the consolidated statements of operations. The following table presents the gains and losses from the Partnership’s derivative instruments involved in fair value hedging relationships recognized in the consolidated statements of operations for the years ended December 31 (in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Location of Gain (Loss) | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ |
​ | ​ | Recognized in Income on | ​ | ​ |
​ | ​ | Derivatives | ​ | 2025 | ​ | 2024 | ​ | 2023 |
Derivatives in fair value hedging relationship | ​ ​ ​ | ​ ​ ​ | ​ ​ ​ | ​ | ​ ​ ​ | ​ ​ ​ | ​ | ​ ​ ​ | ​ ​ ​ | ​ | ​ ​ ​ | ​
Exchange-traded futures contracts and OTC derivative contracts for petroleum commodity products |  | Cost of sales | ​ | $ | 21,121 | ​ | $ | 12,790 | ​ | $ | 7,158 | ​
Hedged items in fair value hedge relationship | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Physical inventory |  | Cost of sales | ​ | $ | (20,077) | ​ | $ | (16,985) | ​ | $ | (15,320) | ​
​ Derivatives Not Accounted for as Hedges The following table presents the gains and losses from the Partnership’s derivative instruments not involved in a hedging relationship recognized in the consolidated statements of operations for the years ended December 31 (in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Location of Gain (Loss) | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Derivatives not designated as | ​ | Recognized in | ​ | ​ | ​
hedging instruments | ​ ​ ​ | Income on Derivatives | ​ | 2025 | ​ ​ ​ | 2024 | ​ ​ ​ | 2023 |
Commodity contracts |  | Cost of sales | ​ | $ | 39,246 | ​ | $ | (13,740) | ​ | $ | 1,803 | ​
​ The Partnership’s commodity contracts and other derivative activity include: (i) exchange-traded derivative contracts that are hedges against inventory and either do not qualify for hedge accounting or are not designated in a hedge accounting relationship, (ii) undelivered physical forward contracts, (iii) exchange-traded derivative contracts used to economically hedge physical forward contracts, (iv) financial forward and OTC swap agreements used to economically hedge physical forward contracts and (v) the derivative instruments under the Partnership’s controlled trading program. The following table presents the fair value of each classification of the Partnership’s derivative instruments and its location in the consolidated balance sheets at December 31, 2025 and 2024 (in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | December 31, 2025 |
​ | ​ | ​ | ​ | Derivatives | ​ | Derivatives Not | ​ | ​ | ​ |
​ | ​ | ​ | ​ | Designated as | ​ | Designated as | ​ | ​ | ​ |
​ | ​ | ​ | ​ | Hedging | ​ | Hedging | ​ | ​ | ​ |
​ | ​ | Balance Sheet Location | ​ | Instruments | ​ | Instruments | ​ | Total |
Asset Derivatives: | ​ ​ ​ | ​ ​ ​ | ​ ​ ​ | ​ | ​ ​ ​ | ​ ​ ​ | ​ | ​ ​ ​ | ​ ​ ​ | ​ | ​ ​ ​ | ​
Exchange-traded derivative contracts |  | Broker margin deposits | ​ | $ | 2,408 | ​ | $ | 49,750 | ​ | $ | 52,158 | ​
Forward derivative contracts (1) |  | Derivative assets | ​ | ​ | — | ​ | ​ | 17,067 | ​ | ​ | 17,067 | ​
Total asset derivatives | ​ | ​ | ​ | $ | 2,408 | ​ | $ | 66,817 | ​ | $ | 69,225 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Liability Derivatives: | ​ | ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Exchange-traded derivative contracts |  | Broker margin deposits | ​ | $ | — | ​ | $ | (48,932) | ​ | $ | (48,932) | ​
Forward derivative contracts (1) | ​ | Derivative liabilities | ​ | ​ | — | ​ | ​ | (4,540) | ​ | ​ | (4,540) | ​
Total liability derivatives | ​ | ​ | ​ | $ | — | ​ | $ | (53,472) | ​ | $ | (53,472) | ​
​ ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | ​ | ​ | December 31, 2024 |
​ | ​ | ​ | ​ | Derivatives | ​ | Derivatives Not | ​ | ​ | ​ |
​ | ​ | ​ | ​ | Designated as | ​ | Designated as | ​ | ​ | ​ |
​ | ​ | ​ | ​ | Hedging | ​ | Hedging | ​ | ​ | ​ |
​ | ​ | Balance Sheet Location | ​ | Instruments | ​ | Instruments | ​ | Total |
Asset Derivatives: | ​ ​ ​ | ​ ​ ​ | ​ ​ ​ | ​ | ​ ​ ​ | ​ ​ ​ | ​ | ​ ​ ​ | ​ ​ ​ | ​ | ​ ​ ​ | ​
Exchange-traded derivative contracts |  | Broker margin deposits | ​ | $ | (9,355) | ​ | $ | 38,483 | ​ | $ | 29,128 | ​
Forward derivative contracts (1) |  | Derivative assets | ​ | ​ | — | ​ | ​ | 13,710 | ​ | ​ | 13,710 | ​
Total asset derivatives | ​ | ​ | ​ | $ | (9,355) | ​ | $ | 52,193 | ​ | $ | 42,838 | ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Liability Derivatives: | ​ | ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Exchange-traded derivative contracts | ​ | Broker margin deposits | ​ | $ | — | ​ | $ | (30,936) | ​ | $ | (30,936) | ​
Forward derivative contracts (1) |  | Derivative liabilities | ​ | ​ | — | ​ | ​ | (6,105) | ​ | ​ | (6,105) | ​
Total liability derivatives | ​ | ​ | ​ | $ | — | ​ | $ | (37,041) | ​ | $ | (37,041) | ​
(1) | Forward derivative contracts include the Partnership’s petroleum and ethanol physical and financial forwards and OTC swaps.
Credit Risk The Partnership’s derivative financial instruments do not contain credit risk related to other contingent features that could cause accelerated payments when these financial instruments are in net liability positions. The Partnership is exposed to credit loss in the event of nonperformance by counterparties to the Partnership’s exchange-traded and OTC derivative contracts, but the Partnership has no current reason to expect any material nonperformance by any of these counterparties. Exchange-traded derivative contracts, the primary derivative instrument utilized by the Partnership, are traded on regulated exchanges, greatly reducing potential credit risks. The Partnership utilizes major financial institutions as its clearing brokers for all New York Mercantile Exchange (“NYMEX”), Chicago Mercantile Exchange (“CME”) and Intercontinental Exchange (“ICE”) derivative transactions and the right of offset exists with these financial institutions under master netting agreements. Accordingly, the fair value of the Partnership’s exchange-traded derivative instruments is presented on a net basis in the consolidated balance sheets. Exposure on OTC derivatives is limited to the amount of the recorded fair value as of the balance sheet dates.

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