Company: DK
Filing Date: 2025-11-07
Form Type: 10-Q
Source: 0001628280-25-050541
Chunk: 174

Company: Delek US Holdings, Inc.
Filing Date: 2025-11-07
Form: 10-Q
Item: Part I, Item 3
Chunk 174
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Changes in commodity prices (mainly crude oil and refined products) and interest rates are our primary sources of market risk. When we make the decision to manage our market exposure, our objective is generally to avoid losses from adverse price changes, realizing we will not obtain the gains of beneficial price changes.

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Management's Discussion and Analysis

Price Risk Management Activities

At times, we enter into the following instruments/transactions in order to manage our market-indexed pricing risk: commodity derivative contracts which we use to manage our price exposure to our inventory positions, future purchases of crude oil and ethanol, future sales of refined products or to fix margins on future production; and future commitments to purchase or sell RINs at fixed prices and quantities, which are used to manage the costs associated with our RINs Obligations and meet the definition of derivative instruments under ASC 815, Derivatives and Hedging ("ASC 815"). In accordance with ASC 815, all of these commodity contracts and future purchase commitments are recorded at fair value, and any change in fair value between periods has historically been recorded in the profit and loss section of our condensed consolidated financial statements. Occasionally, at inception, the Company will elect to designate the commodity derivative contracts as cash flow hedges under ASC 815. Gains or losses on commodity derivative contracts accounted for as cash flow hedges are recognized in other comprehensive income on the condensed consolidated balance sheets and, ultimately, when the forecasted transactions are completed in net revenues or cost of materials and other in the condensed consolidated statements of income.

The following table sets forth information relating to our open commodity derivative contracts, excluding our trading derivative contracts (which are discussed separately below), as of September 30, 2025 ($ in millions):

Total OutstandingNotional Contract Volume by Year of MaturityContract DescriptionFair ValueNotional Contract Volume20252026Contracts not designated as hedging instruments:Crude oil price swaps - long (1)$(9.9)5,358,000 4,308,000 1,050,000 Crude oil price swaps - short (1)9.0 6,612,000 5,562,000 1,050,000 Crude oil options - long (1)— — — Crude oil options - short (1)— — — Inventory, refined product and crack spread swaps - long (1)0.