v3.25.4
Income Taxes (Tables)
 12 Months Ended
Dec. 31, 2025
Income Tax Disclosure [Abstract]  
Schedule of Components of Income Tax Expense (Benefits)
Components of income tax expense (benefit) were:
 Millions of Dollars
 202520242023
Income Tax Expense (Benefit)
Federal
Current$390 662 661 
Deferred114 (282)830 
Foreign
Current261 78 394 
Deferred57 95 (23)
State and local
Current63 11 335 
Deferred7 (64)33 
$892 500 2,230 
Schedule of Deferred Tax Assets and Liabilities Major components of deferred tax liabilities and assets at December 31 were:
 Millions of Dollars
 20252024
Deferred Tax Liabilities
Properties, plants and equipment, and intangibles$3,743 3,493 
Investment in joint ventures*1,094 1,864 
Investment in subsidiaries**3,188 2,511 
Other342 318 
Total deferred tax liabilities8,367 8,186 
Deferred Tax Assets
Benefit plan accruals296 355 
Loss and credit carryforwards 209 162 
Asset retirement obligations and accrued environmental costs422 299 
Other financial accruals and deferrals72 91 
Inventory8 82 
Other246 299 
Total deferred tax assets1,253 1,288 
Less: valuation allowance160 137 
Net deferred tax assets1,093 1,151 
Net deferred tax liabilities$7,274 7,035 
*2024 includes activity associated with our 50% equity interest in WRB.
**Includes activity associated with our consolidated investments in Phillips 66 Partners and DCP LP. 2025 also includes activity associated with our consolidated investment in WRB, see Note 9—Investments, Loans and Long-Term Receivables for additional information.
Schedule of Unrecognized Tax Benefits
The following table is a reconciliation of the changes in our unrecognized income tax benefits balance:

 Millions of Dollars
 202520242023
Balance at January 1$88 116 54 
Additions for tax positions of current year— — — 
Additions for tax positions of prior years— — 66 
Reductions for tax positions of prior years— (28)(4)
Balance at December 31$88 88 116 
Schedule of Effective Income Tax Rate Reconciliation
The amounts of U.S. and foreign income before income taxes, with a reconciliation of income tax at the federal statutory rate to the recorded income tax expense (benefit), were:
 202520242023
 AmountPercentAmountPercentAmountPercent
Income before income taxes
United States$1,035 19.1 %1,796 67.1 7,887 83.3 
Foreign4,385 80.9 879 32.9 1,582 16.7 
$5,420 100.0 %2,675 100.0 9,469 100.0 
Federal statutory income tax1,138 21.0 562 21.0 1,989 21.0 
State income tax, net of federal income tax benefit*57 1.1 (43)(1.6)290 3.1 
Foreign tax effects
United Kingdom
Statutory tax rate difference between United Kingdom and United States59 1.1 — — — — 
Non-taxable gain on disposition**(251)(4.6)— — — — 
Other(2)— — — — — 
Germany
Statutory tax rate difference between Germany and United States308 5.7 — — — — 
Non-taxable gain on disposition***(740)(13.7)— — — — 
Other12 0.2 — — — — 
Other foreign jurisdictions11 0.1 (11)(0.4)39 0.4 
Tax law and rate changes— — — — — — 
Effect of cross-border tax laws
Disposition of Coop**220 4.1 36 1.4 — — 
Other59 1.1 (11)(0.4)(43)(0.5)
Tax credits(1)— (2)(0.1)(2)— 
Changes in valuation allowances21 0.4 17 0.6 22 0.2 
Non-taxable or non-deductible items
Discount on purchased credits— — (36)(1.3)— — 
Other(7)(0.1)(12)(0.5)(74)(0.8)
Changes in unrecognized tax benefits— — 4 0.1 16 0.2 
Other8 0.1 (4)(0.1)(7)— 
$892 16.5 %500 18.7 2,230 23.6 
Note - items that do not meet the 5% threshold for disaggregation have not been separately stated.
* The states that contribute to the majority (greater than 50 percent) of the tax effect in this category include Illinois, Oklahoma, New Jersey, California, and Louisiana for 2025 and 2024, and California, New Jersey, Oklahoma, and Illinois for 2023.
** Related to the disposition of our ownership interest in Coop. See Note 9—Investments, Loans and Long-Term Receivables for additional information.
*** Related to the disposition of 65% of our interest in Germany and Austria Marketing. See Note 9—Investments, Loans and Long-Term Receivables for additional information.