v3.25.4
Derivative Financial Instruments and Risk Management (Tables)
 12 Months Ended
Dec. 31, 2025
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Location and fair value of derivative instruments reported in the Consolidated Financial Position
The location and fair value of derivative instruments reported in Statement 3 were as follows: 

(Millions of dollars)Fair Value
December 31, 2025December 31, 2024
Assets 1
Liabilities 2
Assets 1
Liabilities 2
Designated derivatives
Foreign exchange contracts$364 $(147)$357 $(275)
Interest rate contracts59 (99)10 (201)
Total$423 $(246)$367 $(476)
Undesignated derivatives
Foreign exchange contracts$62 $(75)$91 $(56)
Commodity contracts10 (2)4 (6)
Total return swap contracts1 (2)— (33)
Total$73 $(79)$95 $(95)
1 Assets are classified as Receivables - trade and other or Long-term receivables - trade and other.
2 Liabilities are classified as Accrued expenses or Other liabilities.
Effect of derivatives designated as hedging instruments on Consolidated Results of Operations
Gains (losses) on derivative instruments are categorized as follows:

(Millions of dollars)Years ended December 31,
Gains (Losses) Recognized in Statement 11
Gains (Losses) Recognized in AOCI
Gains (Losses) Reclassified from AOCI2
202520242023202520242023202520242023
Cash Flow Hedges
Foreign exchange contracts$— $— $— $156 $53 $39 $55 $168 $(58)
Interest rate contracts— — — 16 11 9 6 39 55 
Fair Value Hedges
Foreign exchange contracts— — — (9)— — (8)— — 
Interest rate contracts(69)(139)(135)— — — — — — 
Undesignated Hedges
Foreign exchange contracts(65)162 12 — — — — — — 
Commodity contracts26 (10)10 — — — — — — 
Total return swap contracts118 40 — — — — — — — 
Total$10 $53 $(113)$163 $64 $48 $53 $207 $(3)
1 Foreign exchange contract, Commodity contract and Total return swap contract gains (losses) are included in Other income (expense). Interest rate contract gains (losses) are included in Interest expense of Financial Products and Interest expense excluding Financial Products.
2 Foreign exchange contract gains (losses) are primarily included in Other income (expense). Interest rate contract gains (losses) are primarily included in Interest expense of Financial Products.
Cumulative basis adjustments for fair value hedges
The following amounts were recorded in Statement 3 related to cumulative basis adjustments for fair value hedges:

(Millions of dollars)Years ended December 31,
Carrying Value of the Hedged LiabilitiesCumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Value of the Hedged Liabilities
2025202420252024
Long-term debt due within one year$602 $483 $3 $(16)
Long-term debt due after one year5,513 5,327 (37)(170)
Total$6,115 $5,810 $(34)$(186)
Offsetting Assets and Liabilities
The effect of the net settlement provisions of the master netting agreements on our derivative balances upon an event of default or termination event was as follows:

(Millions of dollars)December 31, 2025December 31, 2024
AssetsLiabilitiesAssetsLiabilities
Gross Amounts Recognized$496 $(325)$462 $(571)
Financial Instruments Not Offset(160)160 (186)186 
Net Amount$336 $(165)$276 $(385)