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What changed in LyondellBasell's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of LyondellBasell's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+258 added−249 removedSource: 10-K (2025-02-27) vs 10-K (2024-02-22)

Top changes in LyondellBasell's 2024 10-K

258 paragraphs added · 249 removed · 195 edited across 5 sections

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

68 edited+31 added−20 removed84 unchanged
Biggest changeSpecifically, oversupplies of or lack of demand for particular products or high raw material prices may cause us to reduce production. We may choose to reduce production at certain facilities because we have off-take arrangements at other facilities, which make any reductions or idling unavailable at those facilities.
Biggest changeWe may choose to reduce production at certain facilities because we have off-take arrangements at other facilities, which make any reductions or idling unavailable at those facilities. Temporary outages at our facilities can last for several quarters and sometimes longer. These outages could cause us to incur significant costs, including the expenses of maintaining and restarting these facilities.
The European Union has been undertaking a series of actions under its Circular Economy Action Plan, including adoption of the Single Use Plastics Directive in 2019, which introduced policy measures for single use plastics including bans, product design requirements, extended producer responsibility obligations, and labeling requirements, and a proposal for a Packaging and Packaging Waste Regulation to replace the Packaging and Packaging Waste Directive.
The European Union has been undertaking a series of actions under its Circular Economy Action Plan, including adoption of the Single Use Plastics Directive in 2019, which introduced policy measures for single use plastics including bans, product design requirements, extended producer responsibility obligations, and labeling requirements, and adoption of the Packaging and Packaging Waste Regulation to replace the Packaging and Packaging Waste Directive.
Risks Related to our Business and Industry The cyclicality and volatility of the industries in which we participate may cause significant fluctuations in our operating results. Our business operations are subject to the cyclical and volatile nature of the supply-demand balance in the chemical and refining industries.
Risks Related to our Business and Industry The cyclicality and volatility of the industries in which we participate may cause significant fluctuations in our operating results. Our business operations are subject to the cyclical and volatile nature of the supply-demand balance in the chemical industry.
Disruptions of supplies may occur as a result of transportation issues resulting from natural disasters, water levels, and interruptions in marine water routes, among other causes, that can affect the operations of vessels, barges, rails, trucks and pipeline traffic. These risks are particularly prevalent in the U.S. Gulf Coast area.
Disruptions of supplies may occur as a result of transportation issues resulting from natural disasters, water levels, and interruptions in marine water routes, among other causes, which can affect the operations of vessels, barges, rails, trucks and pipeline traffic. These risks are particularly prevalent in the U.S. Gulf Coast area.
If we are unable to meet our circularity, greenhouse gas reduction, diversity or other goals, or if we are perceived by regulators, customers, stockholders or employees to have not responded appropriately to the growing concern for these issues, our reputation, and therefore our ability to sell our products, could be negatively impacted.
If we are unable to meet our circularity, greenhouse gas reduction, diversity, equity and inclusion, or other goals, or if we are perceived by regulators, customers, stockholders or employees to have not responded appropriately to the growing concern for these issues, our reputation, and therefore our ability to sell our products, could be negatively impacted.
These potential hazards include: • pipeline leaks and ruptures; • explosions; • fires; 24 Table of Conte nts • severe weather and natural disasters; • mechanical failure; • unscheduled downtimes; • supplier disruptions; • labor shortages or other labor difficulties; • transportation interruptions; • remediation complications; • increased restrictions on, or the unavailability of, water for use at our manufacturing sites or for the transport of our products or raw materials; • chemical and oil spills; • discharges or releases of toxic or hazardous substances or gases; • shipment of incorrect or off-specification product to customers; • storage tank leaks; • other environmental risks; and • cyber-attack or other terrorist acts.
These potential hazards include: • pipeline leaks and ruptures; • explosions; • fires; • severe weather and natural disasters; • mechanical failure; • unscheduled downtimes; • supplier disruptions; • labor shortages or other labor difficulties; • transportation interruptions; • remediation complications; • increased restrictions on, or the unavailability of, water for use at our manufacturing sites or for the transport of our products or raw materials; • chemical and oil spills; • discharges or releases of toxic or hazardous substances or gases; • shipment of incorrect or off-specification product to customers; • storage tank leaks; • other environmental risks; and • cyber-attack or other terrorist acts.
Our ability to achieve this goal depends on many factors, including the availability of collection and sortation infrastructure, evolving regulations on chemical recycling and recycled content, our ability to grow our circular and low carbon solutions business established in 2022, make investments in new technologies, expand the global footprint of our recycling facilities and joint ventures, secure access to feedstock, and manufacture recycled and low carbon products at commercial scale.
Our ability to achieve this goal depends on many factors, including the availability of collection and sortation infrastructure, evolving regulations on chemical recycling and recycled content, our ability to grow our CLCS business, established in 2022, make investments in new technologies, expand the global footprint of our recycling facilities and joint ventures, secure access to feedstock, and manufacture recycled and low carbon products at commercial scale.
Additional risks from our multinational business include transportation delays and interruptions, war, terrorist activities, epidemics, pandemics, political instability, import and export controls, sanctions, changes in governmental policies, labor unrest and current and changing regulatory environments. We generate revenues from export sales and operations that may be denominated in currencies other than the relevant functional currency.
Additional risks from our multinational business include transportation delays and interruptions, war, terrorist activities, epidemics, pandemics, political instability, import and export controls, access to infrastructure, sanctions, changes in governmental policies, labor unrest and current and changing regulatory environments. We generate revenues from export sales and operations that may be denominated in currencies other than the relevant functional currency.
The retention of key personnel and appropriate senior management succession planning will continue to be critically important to the successful implementation of our strategies. There is substantial and continuous competition for diverse, talented engineering, manufacturing, and operations employees.
The retention of key personnel and appropriate senior management succession planning will continue to be critically important to the successful implementation of our strategies. There is substantial and continuous competition for engineering, manufacturing, and operations employees.
We may also meet our cash needs by selling receivables under our $900 million U.S. Receivables Facility. As of December 31, 2023, we had no borrowing or letters of credit outstanding and availability of $900 million under this facility.
We may also meet our cash needs by selling receivables under our $900 million U.S. Receivables Facility. As of December 31, 2024, we had no borrowing or letters of credit outstanding and availability of $900 million under this facility.
It is also common in the chemical and refining industries for a facility to have a sole, dedicated source for its utilities, such as steam, electricity and gas. Having a sole or limited number of suppliers may limit our negotiating power, particularly in the case of rising raw material costs.
It is also common in the chemical industry for a facility to have a sole, dedicated source for its utilities, such as steam, electricity and gas. Having a sole or limited number of suppliers may limit our negotiating power, particularly in the case of rising raw material costs.
Consumer deselection, increased regulation of, or prohibition on, the manufacturing or use of plastic or plastic products could limit the use of these products or increase the costs incurred by our customers to use such products, and could lead to a decrease in demand for PE, PP, and other products we make.
Consumer deselection, increased regulation of, or prohibition on, the manufacturing or use of plastic or plastic products could limit the use of these products or increase the costs incurred by our customers to use such products, and could lead to a decrease in demand, particularly for fossil-based PE, PP, and other products we make.
Continuing competition from these companies, especially in our olefin and refining businesses, could limit our ability to increase product sales prices in response to raw material and other cost increases, or could cause us to reduce product sales prices to compete effectively, which would reduce our profitability.
Continuing competition from these companies, especially in our olefin business, could limit our ability to increase product sales prices in response to raw material and other cost increases, or could cause us to reduce product sales prices to compete effectively, which would reduce our profitability.
Many of our current pension plans have projected benefit obligations that exceed the fair value of the plan assets. As of December 31, 2023, the aggregate deficit was $853 million. Any declines in the fair values of the pension plans’ assets could require additional payments by us in order to maintain specified funding levels.
Many of our current pension plans have projected benefit obligations that exceed the fair value of the plan assets. As of December 31, 2024, the aggregate deficit was $815 million. Any declines in the fair values of the pension plans’ assets could require additional payments by us in order to maintain specified funding levels.
Providers of debt and equity financing may also consider our sustainability performance and external ESG ratings, which we have limited ability to influence, which could impact our cost of capital and adversely affect our business. The physical impacts of climate change can negatively impact our facilities and operations.
Providers of debt and equity financing may also consider our sustainability performance and external ESG ratings, which we have limited ability to influence, which could impact our cost of capital and adversely affect our business. 27 Table of Conten ts The physical impacts of climate change can negatively impact our facilities and operations.
We may use our $3,250 million revolving credit facility, which backs our commercial paper program, to meet our cash needs, to the extent available. As of December 31, 2023, we had no borrowings or letters of credit outstanding under the facility and no borrowings outstanding under our commercial paper program, leaving an unused and available credit capacity of $3,250 million.
We may use our $3,750 million revolving credit facility, which backs our commercial paper program, to meet our cash needs, to the extent available. As of December 31, 2024, we had no borrowings or letters of credit outstanding under the facility and no borrowings outstanding under our commercial paper program, leaving an unused and available credit capacity of $3,750 million.
Our pension plans are subject to legislative and regulatory requirements of applicable jurisdictions, which could include, under certain circumstances, local governmental authority to terminate the plan. See Note 15 to the Consolidated Financial Statements for additional information regarding pensions and other post-retirement benefits. Item 1B. Unresolved Staff Comments. None. 33 Table of Conte nts
Our pension plans are subject to legislative and regulatory requirements of applicable jurisdictions, which could include, under certain circumstances, local governmental authority to terminate the plan. See Note 14 to the Consolidated Financial Statements for additional information regarding pensions and other post-retirement benefits. Item 1B. Unresolved Staff Comments None.
Our future operating results are expected to continue to be affected by this cyclicality and volatility. The chemical and refining industries historically have experienced alternating periods of capacity shortages, causing prices and profit margins to increase, followed by periods of excess capacity, resulting in oversupply, declining capacity utilization rates and declining prices and profit margins.
Our future operating results are expected to continue to be affected by this cyclicality and volatility. The chemical industry historically has experienced alternating periods of capacity shortages, causing prices and profit margins to increase, followed by periods of excess capacity, resulting in oversupply, declining capacity utilization rates and declining prices and profit margins.
We are subject to and may in the future be subject to a variety of legal proceedings and claims that arise out of the ordinary conduct of our business. Results of legal proceedings cannot be predicted with certainty.
We are subject to and may in the future be subject to a variety of legal proceedings, claims, and controversies that arise out of the ordinary conduct of our business. Results and timing of these legal matters cannot be predicted with certainty.
Often, we are not able to protect our market position for these products by product differentiation and may not be able to pass on cost increases to our customers due to the significant competition in our business. 27 Table of Conte nts In addition, we face increased competition from companies that may have greater financial resources and different cost structures or strategic goals than us.
Often, we are not able to protect our market position for these products by product differentiation and may not be able to pass on cost increases to our customers due to the significant competition in our industry. In addition, we face increased competition from companies that may have greater financial resources and different cost structures or strategic goals than us.
There is a growing concern with the accumulation of plastic, plastic additives, and microplastics in the environment, particularly in waterways and oceans. Additionally, plastics have recently faced increased public backlash and scrutiny, as well as governmental investigations and enforcement, and private litigation. Policy measures to address this concern are being discussed or implemented by governments at all levels.
There is a growing concern with the accumulation of plastic, plastic additives, and microplastics in the environment, particularly in waterways and oceans. Additionally, plastics are facing increased public backlash and scrutiny, as well as governmental investigations and enforcement, and private litigation. Policy measures to address these concerns are being discussed or implemented by governments at all levels.
In addition, a host of single-use plastic bans and taxes have been passed by countries around the world and states and municipalities throughout the U.S.
In addition, a host of single-use plastic bans, taxes and Extended Producer Responsibility (EPR) bills have been passed by countries around the world and states and municipalities throughout the U.S.
Furthermore, we are subject to certain existing, and may be subject to possible future, laws that limit or may limit our activities while some of our competitors may not be subject to such laws, which may adversely affect our competitiveness. 28 Table of Conte nts Changes in tax laws and regulations could affect our tax rate and our results of operations.
Furthermore, we are subject to certain existing, and may be subject to possible future, laws that limit or may limit our activities while some of our competitors may not be subject to such laws, which may adversely affect our competitiveness. 25 Table of Conten ts Changes in tax laws and regulations could affect our tax rate, financial condition and results of operations.
We sell products in highly competitive global markets and face significant price pressures. We sell our products in highly competitive global markets. Due to the commodity nature of many of our products, competition in these markets is based primarily on price and, to a lesser extent, on product performance, product quality, product deliverability, reliability of supply and customer service.
Due to the commodity nature of many of our products, competition in these markets is based primarily on price and, to a lesser extent, on product performance, product quality, product deliverability, reliability of supply and customer service.
Such concerns and additional requirements could also increase the cost incurred by our customers to use our chemical products and otherwise limit the use of these products, which could lead to a decrease in demand for these products.
Such concerns and additional requirements could also increase the cost incurred by our customers to use our chemical products and otherwise limit the use of these products, which could lead to a decrease in demand for these products. Such a decrease in demand could have an adverse impact on our business and results of operations.
Our tax returns are periodically audited or subjected to review by tax authorities, and any adverse result of these examinations could also have an impact on our effective income tax rate and our results of operations. We regularly evaluate the likelihood of an adverse result of an examination, however, there is no assurance as to the ultimate outcome and impact.
Our tax returns are periodically audited or subjected to review by tax authorities, and we regularly evaluate the likelihood of an adverse result of an examination, however any adverse result of these examinations could also have a material impact on our effective income tax rate, financial condition and results of operations.
Additionally, demand for the products we produce may be reduced. Non-Governmental Organizations have been active in filing lawsuits against governments and private parties in various jurisdictions around the world seeking enforcement of existing laws and new requirements to reduce GHG emissions.
Non-Governmental Organizations have been active in filing lawsuits against governments and private parties in various jurisdictions around the world seeking enforcement of existing laws and new requirements to reduce GHG emissions.
The costs of raw materials and energy represent a substantial portion of our operating expenses. Due to the significant competition we face and the commodity nature of many of our products we are not always able to pass on raw material and energy cost increases to our customers.
Due to the significant competition we face and the commodity nature of many of our products, we are not always able to pass on raw material and energy cost increases to our customers.
Such delays or cost increases may arise as a result of unpredictable factors, many of which are beyond our control, including: • denial of or delay in receiving requisite regulatory approvals and/or permits; • unplanned increases in the cost of construction materials or labor; • disruptions in transportation of components or construction materials; • adverse weather conditions, natural disasters or other events (such as equipment malfunctions, explosions, fires or spills) affecting our facilities, or those of vendors or suppliers; • shortages of sufficiently skilled labor, or labor disagreements resulting in unplanned work stoppages; and • nonperformance by, or disputes with, vendors, suppliers, contractors or subcontractors. 25 Table of Conte nts Any one or more of these factors could have a significant impact on our ongoing capital projects.
Such delays or cost increases may arise as a result of unpredictable factors, many of which are beyond our control, including: • denial of or delay in receiving requisite regulatory approvals and/or permits; 22 Table of Conten ts • unplanned increases in the cost of construction materials, including due to tariffs; • unplanned increases in labor costs; • disruptions in transportation of components or construction materials; • adverse weather conditions, natural disasters or other events (such as equipment malfunctions, explosions, fires or spills) affecting our facilities, or those of vendors or suppliers; • shortages of sufficiently skilled labor, or labor disagreements resulting in unplanned work stoppages; and • nonperformance by, or disputes with, vendors, suppliers, contractors or subcontractors.
If we were unable to make up the delays associated with such factors or to recover the related costs, or if market conditions change, it could materially and adversely affect our business, financial condition, results of operations and cash flows.
Any one or more of these factors could have a significant impact on our ongoing capital projects. If we were unable to make up the delays associated with such factors or to recover the related costs, or if market conditions change, it could materially and adversely affect our business, financial condition, results of operations and cash flows.
For example, higher costs arising from delaying construction of our world-scale PO/TBA plant in Houston including more extensive civil construction and unexpected tariffs on materials, increased our costs and impacted our projected rate of return on the project.
For example, higher costs arising from delaying construction of our PO/TBA plant in Houston increased our costs and impacted our projected rate of return on the project.
General Risk Factors Increased IT and cybersecurity threats and more sophisticated and targeted computer crime could pose a risk to our systems, networks, data, products, facilities and services. Increased global information cybersecurity threats and more sophisticated, targeted computer crime pose a risk to the confidentiality, availability and integrity of our data, operations and infrastructure.
Increased global information cybersecurity threats and more sophisticated, targeted computer crime pose a risk to the confidentiality, availability and integrity of our data, operations and infrastructure.
Compliance with climate regulations may result in increased permitting necessary for the operation of our business or for any of our growth plans. Difficulties in obtaining such permits could have an adverse effect on our future growth.
These types of laws, regulations, and litigation results could increase the cost of purchased energy and increase costs of compliance in various locations. Compliance with climate regulations may result in increased permitting necessary for the operation of our business or for any of our growth plans. Difficulties in obtaining such permits could have an adverse effect on our future growth.
The CSS sets forth far-reaching plans for introducing significant changes to the EU regulatory frameworks for chemicals including the Regulation on Registration, Evaluation, Authorization and Restriction of Chemicals (“REACH”), and the Classification, Labelling and Packaging Regulation (“CLP”) that could result in increased compliance costs, additional restrictions, and/or bans of chemicals used or produced by us.
For example, in the EU, the European Commission is expected to continue to develop and implement legislative changes to the EU regulatory frameworks for chemicals including the Regulation on Registration, Evaluation, Authorization and Restriction of Chemicals (“REACH”), and the Classification, Labelling and Packaging Regulation (“CLP”) that could result in increased compliance costs, additional restrictions, and/or bans of chemicals used or produced by us.
For example, in April 2022, the Finance Committee of the Board of Directors of the Company approved a plan to exit the refining business, resulting in the recognition of $334 million and $187 million of expense in 2023 and 2022, respectively. Temporary outages at our facilities can last for several quarters and sometimes longer.
For example, in April 2022, the Finance Committee of the Board of Directors of the Company approved a plan to exit the refining business, resulting in the recognition of $179 million, $334 million and $187 million of expense in 2024, 2023 and 2022, respectively.
Any broad-based downturn in these emerging markets, or in a key market such as China, could require us to reduce export volumes into these markets and could also require us to divert product sales to less profitable markets. Any of these conditions could ultimately harm our overall business, prospects, operating results, financial condition and cash flows.
Any broad-based downturn in these emerging markets, or in a key market such as China, could require us to reduce export volumes into these markets and could also require us to divert product sales to less profitable markets.
We obtain a portion of our principal raw materials from sources in the Middle East and Central and South America that may be less politically stable than other areas in which we conduct business.
Our ability to source raw materials or deliver products may be adversely affected by political instability, civil disturbances or other governmental actions. We obtain a portion of our principal raw materials from sources in the Middle East and Central and South America that may be less politically stable than other areas in which we conduct business.
If the price of crude oil remains lower relative to U.S. natural gas prices or if the demand for natural gas and NGLs increases, this may have a negative impact on our results of operations. Costs and limitations on supply of raw materials and energy may result in increased operating expenses.
For example, we have benefited from the favorable ratio of U.S. crude oil prices to natural gas prices in the past. If the price of crude oil remains lower relative to U.S. natural gas prices or if the demand for natural gas and NGLs increases, this may have a negative impact on our results of operations.
Unfavorable resolution of these claims could result in restrictions on our ability to deliver the related service or in a settlement that could be material to us. 32 Table of Conte nts Adverse results of legal proceedings could materially adversely affect us.
We also may be subject to claims that our technology, patents or other intellectual property infringes on a third party’s intellectual property rights. Unfavorable resolution of these claims could result in restrictions on our ability to deliver the related service or in a settlement that could be material to us. Adverse results of legal proceedings could materially adversely affect us.
Failure to achieve our emissions targets could result in reputational harm, enforcement or litigation, changing investor sentiment regarding investment in LyondellBasell or a negative impact on access to and cost of capital.
Failure to achieve our emissions targets could result in reputational harm, enforcement or litigation, changing investor sentiment regarding investment in LyondellBasell or a negative impact on access to and cost of capital. 28 Table of Conten ts Failure to achieve our circularity goals could have an adverse effect on the demand for our products and damage our reputation.
Such unrest, if it continues to spread or grow in intensity, could lead to civil wars, regional conflicts or regime changes resulting in governments that are hostile to countries in which we conduct substantial business, such as in the U.S., Europe or their respective trading partners.
Such unrest, if it continues to spread or grow in intensity, could lead to civil wars, regional conflicts or regime changes resulting in governments that are hostile to countries in which we conduct substantial business, such as in the U.S., Europe or their respective trading partners. 20 Table of Conten ts Our business is capital intensive and we rely on cash generated from operations and external financing to fund our growth and ongoing capital needs.
ESG disclosure obligations have required and may continue to require us to implement new practices and reporting processes, and have created and will continue to create additional compliance risk.
International regulators, investors, consumers and other stakeholders are focused on environmental, social, and governance (“ESG”) considerations. ESG disclosure obligations have required and may continue to require us to implement new practices and reporting processes and have created and will continue to create additional compliance risk.
Moreover, interest payments, dividends, capital requirements of our joint ventures, the expansion of our current business or other business opportunities may require significant amounts of capital. If we need external financing, our access to credit markets and pricing of our capital is dependent upon maintaining sufficient credit ratings from credit rating agencies and the state of the capital markets generally.
If we need external financing, our access to credit markets and pricing of our capital is dependent upon maintaining sufficient credit ratings from credit rating agencies and the state of the capital markets generally.
These factors result in significant fluctuations in profits and cash flow from period to period and over business cycles. 21 Table of Conte nts New capacity additions around the world may lead to periods of oversupply and lower profitability.
These factors result in significant fluctuations in profits and cash flow from period to period and over business cycles. New capacity additions around the world may lead to periods of oversupply and lower profitability. The timing and extent of any changes to currently prevailing market conditions are uncertain and supply and demand may be unbalanced at any time.
Additionally, increasing exports of NGLs and crude oil from the U.S. or greater restrictions on hydraulic fracturing could restrict the availability of our raw materials, thereby increasing our costs.
Additionally, increasing exports of NGLs and crude oil from the U.S. or greater restrictions on hydraulic fracturing could restrict the availability of our raw materials, thereby increasing our costs. With increased volatility in raw material costs, our suppliers could impose more onerous terms on us, resulting in shorter payment cycles and increasing our working capital requirements.
In recent years, we have had to shut down plants on the U.S. Gulf Coast, including the temporary shutdown of a portion of our Houston refinery, as a result of various hurricanes and cold weather events striking Texas and Louisiana.
In recent years, we have had to shut down plants on the U.S. Gulf Coast as a result of various hurricanes and cold weather events striking Texas and Louisiana. Our operations are subject to hazards inherent in chemical manufacturing and refining and the related storage and transportation of raw materials, products and wastes.
These outages could cause us to incur significant costs, including the expenses of maintaining and restarting these facilities. In addition, we have significant obligations under take-or-pay agreements. Even though we may reduce production at facilities, we may be required to continue to purchase or pay for utilities or raw materials under these arrangements.
In addition, we have significant obligations under take-or-pay agreements. Even though we may reduce production at facilities, we may be required to continue to purchase or pay for utilities or raw materials under these arrangements. Sustained unfavorable market conditions may also result in asset impairments.
A sustained decrease in the price of crude oil may adversely impact the results of our operations, primarily in North America. Energy costs generally follow price trends of crude oil and natural gas. These price trends may be highly volatile and cyclical.
Energy costs generally follow price trends of crude oil and natural gas. These price trends may be highly volatile and cyclical. In the past, raw material and energy costs have experienced significant fluctuations that adversely affected our business segments’ results of operations.
Our operations in Europe participate in the ETS and we meet our obligations through a combination of free and purchased emission allowances. We anticipate that these regulations will result in an accelerated reduction of our free allowances and higher market prices for purchased allowances.
We anticipate that climate regulation in the EU will result in an accelerated reduction of our free allowances, and higher market prices for purchased allowances.
Our joint venture partners may have different interests or goals than we do and may take actions contrary to our requests, policies or objectives.
In addition, a joint venture may lack adequate cybersecurity protections or other controls that could impact its ability to reliably conduct operations. Our joint venture partners may have different interests or goals than we do and may take actions contrary to our requests, policies or objectives.
We may be required to record material charges against our earnings due to any number of events including impairments of our assets. We may be required to reduce production or idle facilities for extended periods of time or exit certain businesses as a result of the cyclical nature of our industry.
We may be required to reduce production or idle facilities for extended periods of time or exit certain businesses as a result of the cyclical nature of our industry. Specifically, oversupplies of or lack of demand for particular products or high raw material prices may cause us to reduce production.
We maintain property, business interruption, product, general liability, casualty and other types of insurance that we believe are appropriate for our business and operations as well as in line with industry practices. However, we are not fully insured against all potential hazards incident to our business, including losses resulting from natural disasters or climate-related exposures, wars or terrorist acts.
We maintain property, business interruption, product, general liability, casualty and other types of insurance that we believe are appropriate for our business and operations as well as in line with industry practices.
We have from time to time experienced, and we may continue to experience, difficulty in hiring and retaining employees with appropriate qualifications, and may not be able to fill positions in desired geographic areas or at all.
We have from time to time experienced, and we may continue to experience, difficulty in hiring and retaining employees with appropriate qualifications, and may not be able to fill positions in desired geographic areas or at all. 30 Table of Conten ts Significant changes in pension fund investment performance or assumptions relating to pension costs may adversely affect the valuation of pension obligations, the funded status of pension plans, and our pension cost.
These transactions pose risks and challenges that could negatively impact our business and financial statements. 26 Table of Conte nts Acquisitions involve numerous risks, including meeting our standards for compliance, problems combining the purchased operations, technologies or products, unanticipated costs and liabilities, diversion of management’s attention from our core businesses, and potential loss of key employees.
Acquisitions involve numerous risks, including meeting our standards for compliance, problems combining the purchased operations, technologies or products, unanticipated costs and liabilities, diversion of management’s attention from our core businesses, and potential loss of key employees. There can be no assurance that we will be able to integrate successfully any businesses, products, technologies, or personnel that we might acquire.
Under the 2015 Paris Agreement, parties to the United Nations Framework Convention on Climate Change agreed to undertake ambitious efforts to reduce GHG emissions and strengthen adaptation to the effects of climate change. 29 Table of Conte nts Jurisdictions in which we operate, including, in particular, the European Union (EU), are preparing national legislation and protection plans to implement their emission reduction commitments under the Paris Agreement.
Under the 2015 Paris Agreement, parties to the United Nations Framework Convention on Climate Change agreed to undertake ambitious efforts to reduce GHG emissions and strengthen adaptation to the effects of climate change.
The timing and extent of any changes to currently prevailing market conditions are uncertain and supply and demand may be unbalanced at any time. As a consequence, we are unable to accurately predict the extent or duration of future industry cycles or their effect on our business, financial condition or results of operations.
As a consequence, we are unable to accurately predict the extent or duration of future industry cycles or their effect on our business, financial condition or results of operations. A sustained decrease in the price of crude oil may adversely impact the results of our operations, primarily in North America.
When we do have the ability to pass on the cost increases, we are not always able to do so quickly enough to avoid adverse impacts on our results of operations.
When we do have the ability to pass on the cost increases, we are not always able to do so quickly enough to avoid adverse impacts on our results of operations. 19 Table of Conten ts Cost increases for raw materials, energy, or broad-based price inflation also increase working capital needs, which could reduce our liquidity and cash flow.
Any default under any of our credit arrangements could cause a default under many of our other credit agreements and debt instruments.
Any default under any of our credit arrangements could cause a default under many of our other credit agreements and debt instruments. Without waivers from lenders party to those agreements, any such default could have a material adverse effect on our ability to continue to operate.
Public perception of the risks associated with our products and production processes could impact product acceptance and influence the regulatory environment in which we operate. While we have management systems, procedures and controls to manage these risks, issues could be created by events outside of our control, including natural disasters, severe weather events and acts of sabotage.
Public perception of the risks associated with our products and production processes could impact product acceptance and influence the regulatory environment in which we operate.
Our ability to achieve these goals depends on many factors, including the availability of technology, our ability to secure permits and emissions credits, evolving regulatory requirements, competitor actions, customer preferences, and our ability to reduce emissions from our operations through modernization and innovation, reduce the emissions intensity of the electricity we buy, and invest in renewables and low carbon energy.
Our ability to achieve these goals depends on many factors, including the development and availability of technology, our ability to secure permits and emissions credits, project execution risk, the availability of infrastructure, the availability of suppliers, the availability of supportive governmental policies and markets, to evolving regulatory requirements, competitor actions, and customer and consumer preferences.
Irrespective of its merits, litigation may be both lengthy and disruptive to our operations and may cause significant expenditure and diversion of management attention. We may be faced with significant monetary damages or injunctive relief against us that could have an adverse impact on our business and results of operations should we fail to prevail in certain matters.
We may be faced with significant monetary damages or injunctive relief against us that could have an adverse impact on our business and results of operations should we fail to prevail in certain matters. For example, in 2024, we were named as one defendant in two separate proposed class action cases related to industry-wide claims about plastics recyclability.
Our business is capital intensive and we rely on cash generated from operations and external financing to fund our growth and ongoing capital needs. Limitations on access to external financing could adversely affect our operating results. We require significant capital to operate our current business and fund our growth strategy.
Limitations on access to external financing could adversely affect our operating results. We require significant capital to operate our current business and fund our growth strategy. Moreover, interest payments, dividends, capital requirements of our joint ventures, the expansion of our current business or other business opportunities may require significant amounts of capital.
In addition to changes in the supply and demand for products, changes in energy prices and other worldwide economic conditions can cause volatility.
While we are exiting the refining business in the first quarter of 2025, we expect to experience similar volatility in that industry until closure of our Houston refinery. In addition to changes in the supply and demand for products, changes in energy prices and other worldwide economic conditions can cause volatility.
Further, because a part of our business involves licensing polyolefin process technology, our licensees are exposed to similar risks involved in the manufacture and marketing of polyolefins.
While we have management systems, procedures and controls to manage these risks, issues could be created by events outside of our control, including natural disasters, severe weather events and acts of sabotage. 21 Table of Conten ts Further, because a part of our business involves licensing polyolefin process technology, our licensees are exposed to similar risks involved in the manufacture and marketing of polyolefins.
Without waivers from lenders party to those agreements, any such default could have a material adverse effect on our ability to continue to operate. 23 Table of Conte nts Risks Related to our Operations Our operations are subject to risks inherent in chemical and refining businesses, and we could be subject to liabilities for which we are not fully insured or that are not otherwise mitigated.
Risks Related to our Operations Our operations are subject to risks inherent in the chemical industry, and we could be subject to liabilities for which we are not fully insured or that are not otherwise mitigated.
Any new supply agreements we enter into may not have terms as favorable as those contained in our current supply agreements. Additionally, there is concern over the reliability of water sources, including around the U.S. Gulf Coast where several of our facilities are located.
For example, our ability to operate our site in Brindisi, Italy, may be negatively impacted by the potential shutdown of its propylene supplier. Additionally, there is concern over the reliability of water sources, including around the U.S. Gulf Coast where several of our facilities are located.
For example, during the fourth quarter of 2023, we identified an impairment trigger related to the adverse financial performance of our European PO joint venture which resulted in a non-cash impairment charge of $192 million. Any decision to permanently close facilities or exit a business may result in impairment and other charges to earnings.
For example, in 2024, challenging market conditions in Europe resulted in a $837 million non-cash impairment of property, plant and equipment in our O&P-EAI segment. 23 Table of Conten ts Any decision to permanently close facilities or exit a business may result in impairment and other charges to earnings.
For example, on March 2, 2022, the United Nations Environment Assembly adopted a resolution to develop a new international legally binding instrument on plastic pollution with the ambition to complete the negotiations by the end of 2024.
For example, over the past two years the United Nations Environment Program has been overseeing the development of a new international legally binding instrument on plastic pollution. While these international negotiations have been challenging, significant progress has been made with a goal of finalizing this treaty by the end of 2025.
Removed
In the past, raw material and energy costs have experienced significant fluctuations that adversely affected our business segments’ results of operations. For example, we have benefited from the favorable ratio of U.S. crude oil prices to natural gas prices in the past.
Added
Costs and limitations on supply of raw materials and energy may result in increased operating expenses. The costs of raw materials and energy represent a substantial portion of our operating expenses.
Removed
For example, during 2022, increases in costs for energy and raw materials, and the related decline in demand for our products, resulted in the reduction of operating rates or delayed restart of operations at several of our sites in Europe.
Added
Any new supply agreements we enter into may not have terms as favorable as those contained in our current supply agreements. The reliance on single or limited suppliers heightens our vulnerability to supply chain interruptions, and the closure of such a supplier could cause us to be unable to profitably operate our assets.
Removed
Cost increases for raw materials, energy, or broad-based price inflation also increase working capital needs, which could reduce our liquidity and cash flow.
Added
However, we are not fully insured against all potential hazards incident to our business, including losses resulting from natural disasters or climate-related exposures, wars, terrorist acts, or cybersecurity incidents.
Removed
With increased volatility in raw material costs, our suppliers could impose more onerous terms on us, resulting in shorter payment cycles and increasing our working capital requirements. 22 Table of Conte nts Our ability to source raw materials or deliver products may be adversely affected by political instability, civil disturbances or other governmental actions.
Added
We may be required to record material charges against our earnings due to any number of events including impairments of our assets. We review our assets for impairment when events or changes in circumstances indicate the carrying value may not be recoverable. We test goodwill for impairment at least annually.
Removed
In addition, because the Houston refinery is our only refining operation, an outage at the refinery could have a particularly negative impact on our operating results as we do not have the ability to increase refining production elsewhere.
Added
The need to test for impairment can be based on several indicators, including a significant reduction in prices of or demand for products produced, a weakened outlook for profitability, a significant reduction in margins, an expectation that a long-lived asset will be sold or otherwise disposed of significantly before the end of its previously estimated useful life, other changes to contracts or changes in the regulatory environment.
Removed
Our operations are subject to hazards inherent in chemical manufacturing and refining and the related storage and transportation of raw materials, products and wastes.
Added
These transactions pose risks and challenges that could negatively impact our business and financial statements. In 2024, we launched a strategic review of certain assets in Europe to align our asset base with our strategy.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWe recognize the risk posed by global cybersecurity threats, and our Board is regularly updated on emerging risks and maintains oversight of our cybersecurity program implemented to address them. In 2023, the Board conducted its annual comprehensive review of specific cybersecurity and process control topics at its September meeting.
Biggest changeAdditionally, high risk third-party service providers are continuously monitored for security health and active threats. 31 Table of Conten ts We recognize the risk posed by global cybersecurity threats, and our Board is regularly updated on emerging risks and maintains oversight of our cybersecurity program implemented to address them.
In addition, in 2023, management conducted ransomware simulation exercises and engaged outside consultants to perform external perimeter penetration testing. While we attempt to mitigate cybersecurity risks by employing a number of measures, as described above, our employees, systems, networks, products, facilities and services remain potentially vulnerable to ransomware or sophisticated espionage.
In addition, in 2024, management conducted ransomware simulation exercises and engaged outside consultants to perform external perimeter penetration testing. While we attempt to mitigate cybersecurity risks by employing a number of measures, as described above, our employees, systems, networks, products, facilities and services remain potentially vulnerable to ransomware or sophisticated espionage.
Our cybersecurity program includes, but is not limited to: • annual cybersecurity education for all company computer users on relevant policies and standards, best practices at work and at home; • communication processes including how to identify, respond, and report threats or potential vulnerabilities; 34 Table of Conte nts • protective software installed and configured on Company systems and mobile devices, updated and patched on a regular basis, to provide the highest level of protection against malicious threats; • an established program based on the MITRE ATT&CK framework for dealing with ransomware and other cybersecurity incidents; • regular technical risk assessments of our network, applications and manufacturing facilities, using a combination of trusted suppliers and a dedicated, objective team; • penetration, discovery and vulnerability assessments conducted daily; • mobile threat protection mechanisms and policies; • business continuity plans that are well documented and tested regularly; disaster recovery plans that are also well documented and tested at least annually; and • coverage for non-damage business interruption or liability for data breaches as a part of the Company’s combined insurance programs.
Our cybersecurity program includes, but is not limited to: • annual cybersecurity education for all company computer users on relevant policies and standards, best practices at work and at home; • communication processes including how to identify, respond, and report threats or potential vulnerabilities; • protective software installed and configured on Company systems and mobile devices, updated and patched on a regular basis, to provide the highest level of protection against malicious threats; • an established program based on the MITRE ATT&CK framework for dealing with ransomware and other cybersecurity incidents; • regular technical risk assessments of our network, applications and manufacturing facilities, using a combination of trusted suppliers and a dedicated, objective team; • penetration, discovery and vulnerability assessments conducted daily; • mobile threat protection mechanisms and policies; • business continuity plans that are well documented and tested regularly; disaster recovery plans that are also well documented and tested at least annually; certain key financial applications that are tested at least semi-annually; and • coverage for non-damage business interruption or liability for data breaches as a part of the Company’s combined insurance programs.
The Vice President of Cybersecurity has a Master of Science degree in Cybersecurity Operations, is certified as an information security professional with the International Information System Security Certification Consortium (ISC2) and International Association of Privacy Professionals, and has over thirty years of leadership experience in technology, systems architecture, and cybersecurity.
The CISO has a Master of Science degree in Cybersecurity Operations, is certified as an information security professional with the International Information System Security Certification Consortium (ISC2) and International Association of Privacy Professionals, and has over thirty years of leadership experience in technology, systems architecture, and cybersecurity.
The Vice President of Cybersecurity leads our cybersecurity program and reports to the Executive Vice President and Chief Innovation Officer, who serves on the Executive Committee and reports to the CEO.
The Chief Information Security Officer (“CISO”) is the Vice President of Cybersecurity leading our cybersecurity program and reports to the Executive Vice President and Chief Innovation Officer, who serves on the Executive Committee and reports to the CEO.
Cybersecurity events are continuously monitored by global security operations centers staffed in the United States, European Union, and Asia Pacific regions with events and incidents being managed based upon the MITRE ATT&CK framework, a system for classifying and describing cyber attacks and intrusions.
Cybersecurity events are continuously monitored by global security operations centers staffed in the United States, European Union, and Asia Pacific regions with events and incidents being managed based upon the MITRE ATT&CK framework, a system for classifying and describing cyberattacks and intrusions. Management provides guidance and is informed of cybersecurity events through a committee with cross-functional representation of executive leadership.
Cybersecurity risk evaluation is integrated into our enterprise risk management processes and is presented to management and the board as a part of that process. While management is responsible for assessing and managing our day-to-day risks and control systems, the Audit Committee of the Board oversees our information technology and cybersecurity risks.
While management is responsible for assessing and managing our day-to-day risks and control systems, the Audit Committee of the Board oversees our information technology and cybersecurity risks.
Management provides guidance and is informed of cybersecurity events through a committee with cross-functional representation of executive leadership. The committee meets at least quarterly for activities such as determining policy, reviewing active risks, assessing impact of emerging threats or regulatory changes, and monitoring active incidents.
The committee meets at least quarterly for activities such as determining policy, reviewing active risks, assessing impact of emerging threats or regulatory changes, and monitoring active incidents.
This committee also receives escalated alerts within 24-hours of confirmed cybersecurity events, and will determine the severity of the incident, engage with crisis management as necessary, and disseminate that information internally as appropriate and warranted. Third-party service providers must meet baseline security requirements before they connect to our systems or manage sensitive information.
This committee also receives escalated alerts within 24-hours of confirmed cybersecurity events, and will determine the severity of the incident, engage with crisis management as necessary, and disseminate that information internally as appropriate and warranted.
They are evaluated based on risk, which is based on financial, operational, legal/regulatory, capacity, cybersecurity posture, and reputational impact. Additionally, high risk third-party service providers are continuously monitored for security health and active threats.
They are evaluated based on risk, which is based on financial, operational, legal/regulatory, capacity, cybersecurity posture, and reputational impact.
No risks from cybersecurity threats, including those resulting from any previous cybersecurity incidents, have materially affected, or are reasonably likely to materially affect, the Company, including its business strategy, results of operations or financial condition.
As of February 27, 2025, we do not believe that any cybersecurity threats, including those resulting from any previous cybersecurity incidents, have materially affected, or are reasonably likely to materially affect, the Company, including its business strategy, results of operations or financial condition. See Item 1A. Risk Factors - General Risk Factors for additional information. Item 3. Legal Proceedings.
Added
The Company’s generative artificial intelligence strategy is to “Generate Responsibly,” actively providing education and awareness, encouraging the safe exploration of generative AI tools and resources, consistent with Company data protection policies and standards. Third-party service providers must meet baseline security requirements before they connect to our systems or manage sensitive information.
Added
In 2024, management provided a detailed cybersecurity update to the Board and led discussions on specific cybersecurity and process control topics at its May meeting. The Board also attended a training session led by outside counsel on the challenges public companies face with respect to cybersecurity and ransomware attacks in November.
Added
Information regarding our litigation and other legal proceedings can be found in Note 17 to the Consolidated Financial Statements.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

5 edited+0 added−1 removed4 unchanged
Biggest changeThe graph is presented pursuant to SEC rules and is not meant to be an indication of our future performance. 37 Table of Conte nts 12/31/2018 12/31/2019 12/31/2020 12/31/2021 12/31/2022 12/31/2023 LyondellBasell Industries N.V. $100.00 $119.41 $122.56 $128.77 $127.51 $153.91 S&P 500 Index $100.00 $131.49 $155.68 $200.37 $164.08 $207.21 S&P 500 Chemicals Index $100.00 $122.01 $144.03 $181.35 $160.92 $178.69 Issuer Purchases of Equity Securities On May 19, 2023, our shareholders approved a proposal to authorize us to repurchase up to 34.0 million ordinary shares, through November 19, 2024, which superseded any prior repurchase authorizations.
Biggest changeThe graph is presented pursuant to SEC rules and is not meant to be an indication of our future performance. 12/31/2019 12/31/2020 12/31/2021 12/31/2022 12/31/2023 12/31/2024 LyondellBasell Industries N.V. $100.00 $102.64 $107.84 $106.79 $128.89 $106.49 S&P 500 Index $100.00 $118.40 $152.39 $124.79 $157.59 $197.02 S&P 500 Chemicals Index $100.00 $118.05 $148.63 $131.89 $146.45 $146.15 Issuer Purchases of Equity Securities 2024 Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number of Shares That May Yet Be Purchased Under the Plans or Programs October 1 - October 31 — $ — — 32,820,080 November 1 - November 30 384,698 $ 85.80 384,698 32,435,382 December 1 - December 31 629,480 $ 75.47 629,480 31,805,902 Total 1,014,178 $ 79.39 1,014,178 31,805,902 On May 24, 2024, our shareholders approved a share repurchase authorization of up to 34.0 million ordinary shares, through November 24, 2025, which superseded any prior repurchase authorizations.
The graph below shows the relative investment performance of LyondellBasell Industries N.V. shares, the S&P 500 Index and the S&P 500 Chemicals Index since December 31, 2018. The graph assumes that $100 was invested on December 31, 2018 and any dividends paid were reinvested at the date of payment.
The graph below shows the relative investment performance of LyondellBasell Industries N.V. shares, the S&P 500 Index and the S&P 500 Chemicals Index since December 31, 2019. The graph assumes that $100 was invested on December 31, 2019 and any dividends paid were reinvested at the date of payment.
Holders As of February 20, 2024, there were approximately 5,000 record holders of our shares, including Cede & Co. as nominee of the Depository Trust Company. Equity Compensation Plan See Part III, Item 11. Executive Compensation for information relating to the Company’s equity compensation plans.
Holders As of February 25, 2025, there were approximately 5,000 record holders of our shares, including Cede & Co. as nominee of the Depository Trust Company. Equity Compensation Plan See Part III, Item 11. Executive Compensation for information relating to the Company’s equity compensation plans.
The maximum number of shares that may yet be purchased is not necessarily an indication of the number of shares that will ultimately be purchased.
The maximum number of shares that may yet be purchased is not necessarily an indication of the number of shares that will ultimately be purchased. Item 6. Reserved 34 Table of Conten ts
Performance Graph The performance graph and the information contained in this section is not “soliciting material,” is being furnished, not filed, with the SEC and is not to be incorporated by reference into any of our filings under the Securities Act or the Exchange Act whether made before or after the date hereof and irrespective of any general incorporation language contained in such filing.
United Kingdom Tax Considerations As a result of its United Kingdom tax residency, dividend distributions by LyondellBasell Industries N.V. to its shareholders are not subject to withholding tax, as the United Kingdom currently does not levy a withholding tax on dividend distributions. 33 Table of Conten ts Performance Graph The performance graph and the information contained in this section is not “soliciting material,” is being furnished, not filed, with the SEC and is not to be incorporated by reference into any of our filings under the Securities Act or the Exchange Act whether made before or after the date hereof and irrespective of any general incorporation language contained in such filing.
Removed
United Kingdom Tax Considerations As a result of its United Kingdom tax residency, dividend distributions by LyondellBasell Industries N.V. to its shareholders are not subject to withholding tax, as the United Kingdom currently does not levy a withholding tax on dividend distributions.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

96 edited+28 added−32 removed53 unchanged
Biggest changeRevenues and the components of EBITDA for the periods presented are reflected in the tables below for our reportable segments: Year Ended December 31, Millions of dollars 2023 2022 Sales and other operating revenues: O&P-Americas $ 11,280 $ 14,480 O&P-EAI 10,479 13,455 I&D 11,086 12,950 APS 3,698 4,202 Refining 9,714 11,893 Technology 663 693 Other, including segment eliminations (5,813) (7,222) Total $ 41,107 $ 50,451 Operating income (loss): O&P-Americas $ 1,665 $ 2,206 O&P-EAI (160) 75 I&D 1,262 1,604 APS (261) 16 Refining 221 889 Technology 334 331 Other, including segment eliminations (8) (20) Total $ 3,053 $ 5,101 Depreciation and amortization: O&P-Americas $ 587 $ 591 O&P-EAI 207 171 I&D 443 332 APS 98 95 Refining 158 39 Technology 41 39 Total $ 1,534 $ 1,267 Income (loss) from equity investments: O&P-Americas $ 49 $ 98 O&P-EAI (55) (68) I&D (13) (25) APS (1) — Total $ (20) $ 5 43 Table of Conte nts Year Ended December 31, Millions of dollars 2023 2022 Other (expense) income, net: O&P-Americas $ 2 $ (30) O&P-EAI (1) — I&D (13) (39) APS 2 4 Refining — (7) Technology — (4) Other, including intersegment eliminations (48) 4 Total $ (58) $ (72) EBITDA: O&P-Americas $ 2,303 $ 2,865 O&P-EAI (9) 178 I&D 1,679 1,872 APS (162) 115 Refining 379 921 Technology 375 366 Other, including intersegment eliminations (56) (16) Total $ 4,509 $ 6,301 Olefins and Polyolefins-Americas Segment Overview —EBITDA decreased in 2023 relative to 2022 primarily driven by lower polyolefin margins.
Biggest changeRevenues and other information for the periods presented are reflected in the tables below for our reportable segments: Year Ended December 31, Millions of dollars 2024 2023 Sales and other operating revenues: O&P-Americas segment $ 11,533 $ 11,280 O&P-EAI segment 10,867 10,479 I&D segment 10,424 11,086 APS segment 3,634 3,698 Refining segment 8,559 9,714 Technology segment 671 663 Other, including intersegment eliminations (5,386) (5,813) Total $ 40,302 $ 41,107 Operating income (loss): O&P-Americas segment $ 1,805 $ 1,665 O&P-EAI segment (1,008) (160) I&D segment 951 1,262 APS segment (48) (261) Refining segment (213) 221 Technology segment 338 334 Other, including intersegment eliminations (8) (8) Total $ 1,817 $ 3,053 38 Table of Conten ts Year Ended December 31, Millions of dollars 2024 2023 Depreciation and amortization: O&P-Americas segment $ 619 $ 587 O&P-EAI segment 220 207 I&D segment 401 443 APS segment 90 98 Refining segment 150 158 Technology segment 42 41 Total $ 1,522 $ 1,534 Income (loss) from equity investments: O&P-Americas segment $ 13 $ 49 O&P-EAI segment (217) (55) I&D segment (13) (13) APS segment — (1) Total $ (217) $ (20) Impairments: O&P-Americas segment $ — $ 25 O&P-EAI segment 892 38 I&D segment 2 192 APS segment 55 252 Refining segment — 11 Total $ 949 $ 518 Gain on sale of business: I&D segment $ 284 $ — Total $ 284 $ — Other income (expense), net: O&P-Americas segment $ 8 $ 2 O&P-EAI segment 14 (1) I&D segment 41 (13) APS segment 12 2 Refining segment 3 — Technology segment (1) — Other, including intersegment eliminations (27) (48) Total $ 50 $ (58) EBITDA: O&P-Americas segment $ 2,445 $ 2,303 O&P-EAI segment (991) (9) I&D segment 1,664 1,679 APS segment 54 (162) Refining segment (60) 379 Technology segment 379 375 Other, including intersegment eliminations (35) (56) Total $ 3,456 $ 4,509 39 Table of Conten ts Olefins and Polyolefins-Americas Segment Overview —EBITDA increased in 2024 relative to 2023 primarily due to improved olefins margins, partially offset by lower polymer margins.
In calculating the impact of margin and volume on EBITDA, consistent with industry practice, management offsets revenues and volumes related to ethylene co-products against the cost to produce ethylene. Volume and price impacts of ethylene co-products are reported in margin.
In calculating the impact of margin and volume on EBITDA, consistent with industry practice, management offsets revenues and volumes related to ethylene co-products against the cost to produce ethylene. Volume and price impacts of ethylene co-products are reported in margin.
Accordingly, our cost of sales and results of operations may be affected by such fluctuations. We do not believe any of our inventory is at risk for impairment at this time, however as prices for our products and raw materials are inherently volatile and therefore no prediction can be given with certainty.
Accordingly, our cost of sales and results of operations may be affected by such fluctuations. We do not believe any of our inventory is at risk for impairment at this time, however as prices for our products and raw materials are inherently volatile, no prediction can be given with certainty.
Ethylene Raw Materials —Ethylene and its co-products are produced from two major raw material groups: • NGLs, principally ethane and propane, the prices of which are generally affected by natural gas prices; and • crude oil-based liquids (“liquids” or “heavy liquids”), including naphtha, condensates and gas oils, the prices of which are generally related to crude oil prices.
Ethylene Raw Materials —Ethylene and its co-products are produced from two major raw material groups: • natural gas liquids (“NGLs”), principally ethane and propane, the prices of which are generally affected by natural gas prices; and • crude oil-based liquids (“liquids” or “heavy liquids”), including naphtha, condensates and gas oils, the prices of which are generally related to crude oil prices.
On an annual basis, feedstock and energy related costs generally represent approximately 70% to 80% of cost of sales. Other variable costs account for approximately 10% of cost of sales and fixed operating costs, consisting primarily of expenses associated with employee compensation, depreciation and amortization, and maintenance, account for the remainder.
On an annual basis, feedstock and energy related costs generally represent approximately 75% to 80% of cost of sales. Other variable costs account for approximately 10% of cost of sales and fixed operating costs, consisting primarily of expenses associated with employee compensation, depreciation and amortization, and maintenance, account for the remainder.
Availability under this facility is net of outstanding borrowings, outstanding letters of credit provided under the facility and notes issued under our commercial paper program. At December 31, 2023, we had no outstanding borrowings of commercial paper, and no borrowings or letters of credit outstanding under this facility; and • $900 million under our $900 million U.S. Receivables Facility.
Availability under this facility is net of outstanding borrowings, outstanding letters of credit provided under the facility and notes issued under our commercial paper program. At December 31, 2024, we had no outstanding commercial paper and no borrowings or letters of credit outstanding under this facility; and • $900 million under our $900 million U.S. Receivables Facility.
The following table reflects the sensitivity of the benefit obligations and the net periodic benefit costs of our pension plans to changes in the actuarial assumptions: Effects on Benefit Obligations in 2023 Effects on Net Periodic Pension Costs in 2024 Millions of dollars U.S. Non-U.S. U.S. Non-U.S.
The following table reflects the sensitivity of the benefit obligations and the net periodic benefit costs of our pension plans to changes in the actuarial assumptions: Effects on Benefit Obligations in 2024 Effects on Net Periodic Pension Costs in 2025 Millions of dollars U.S. Non-U.S. U.S. Non-U.S.
The discussion summarizing the significant factors affecting the results of operations and financial condition for the year ended December 31, 2021 and for the year ended December 31, 2022 compared to 2021 has been excluded from this Form 10-K and can be found in the update to Part II, “Item 7.
The discussion summarizing the significant factors affecting the results of operations and financial condition for the year ended December 31, 2022 and for the year ended December 31, 2023 compared to 2022 has been excluded from this Form 10-K and can be found in Part II, “Item 7.
Such estimates are consistent with those used in our financial planning and business performance reviews. 53 Table of Conte nts When an income approach is used to estimate fair value of our long-lived assets, the cash flows are discounted using a rate that is based on a variety of factors, including market and economic conditions, operational risk, regulatory risk and political risk.
Such estimates are consistent with those used in our financial planning and business performance reviews. When an income approach is used to estimate fair value of our long-lived assets, the cash flows are discounted using a rate that is based on a variety of factors, including market and economic conditions, operational risk, regulatory risk and political risk.
Share Repurchases In May 2023, our shareholders approved a proposal to authorize us to repurchase up to 34.0 million ordinary shares, through November 19, 2024, which superseded any prior repurchase authorizations. Our share repurchase authorization does not have a stated dollar amount, and purchases may be made through open market purchases, private market transactions or other structured transactions.
Share Repurchases In May 2024, our shareholders approved a proposal to authorize us to repurchase up to 34.0 million ordinary shares, through November 24, 2025, which superseded any prior repurchase authorizations. Our share repurchase authorization does not have a stated dollar amount, and purchases may be made through open market purchases, private market transactions or other structured transactions.
Our assumed discount rate is based on yield information for high-quality corporate bonds with durations comparable to the expected cash settlement of our obligations. For the purpose of measuring the benefit obligations at December 31, 2023, we used a weighted average discount rate of 5.80% for the U.S. plans, which reflects the different terms of the related benefit obligations.
Our assumed discount rate is based on yield information for high-quality corporate bonds with durations comparable to the expected cash settlement of our obligations. For the purpose of measuring the benefit obligations at December 31, 2024, we used a weighted average discount rate of 5.35% for the U.S. plans, which reflects the different terms of the related benefit obligations.
Inherent in such policies are certain key assumptions and estimates made by management and updated periodically based on its latest assessment of the current and projected business and general economic environment. 52 Table of Conte nts Management believes the following accounting policies and estimates, and the judgments and uncertainties affecting them, are critical in understanding our reported operating results and financial condition.
Inherent in such policies are certain key assumptions and estimates made by management and updated periodically based on its latest assessment of the current and projected business and general economic environment. Management believes the following accounting policies and estimates, and the judgments and uncertainties affecting them, are critical in understanding our reported operating results and financial condition.
These purchase arrangements include provisions which state minimum purchase quantities; however, in the event we do not take the contractual minimum volumes, we are obligated to compensate the vendor only for any resulting economic losses they suffer. No material fees were paid to vendors for such losses in 2023.
These purchase arrangements include provisions which state minimum purchase quantities or fixed-fees; however, in the event we do not take the contractual minimum volumes, we are obligated to compensate the vendor only for any resulting economic losses they suffer. No material fees were paid to vendors for such losses in 2024.
Repurchased shares could be retired or used for general corporate purposes, including for various employee benefit and compensation plans. The maximum number of shares that may yet be purchased is not necessarily an indication of the number of shares that will ultimately be purchased. In 2023, we purchased 2.3 million shares under our share repurchase authorization for $211 million.
Repurchased shares could be retired or used for general corporate purposes, including for various employee benefit and compensation plans. The maximum number of shares that may yet be purchased is not necessarily an indication of the number of shares that will ultimately be purchased. In 2024, we purchased 2.2 million shares under our share repurchase authorization for $198 million.
The weighted average expected long-term rate of return on assets in our non-U.S. plans of 3.57% is based on expectations and asset allocations that vary by region. The asset allocations are summarized in Note 15 to the Consolidated Financial Statements.
The weighted average expected long-term rate of return on assets in our non-U.S. plans of 4.14% is based on expectations and asset allocations that vary by region. The asset allocations are summarized in Note 14 to the Consolidated Financial Statements.
For additional information related to our share repurchase authorizations, see Note 19 to the Consolidated Financial Statements. Capital Budget In 2024, we are planning to invest approximately $2.1 billion in capital expenditures. Approximately 60% of the 2024 budget is planned for sustaining maintenance, with the remaining budget supporting profit-generating growth projects.
For additional information related to our share repurchase authorizations, see Note 18 to the Consolidated Financial Statements. Capital Budget In 2025, we are planning to invest approximately $1.9 billion in capital expenditures. Approximately $1.2 billion of the 2025 budget is planned for sustaining maintenance, with the remaining budget supporting profit-generating growth projects.
As of February 20, 2024, we had approximately 33.1 million shares remaining under the current authorization. The timing and amounts of additional shares repurchased, if any, will be determined based on our evaluation of market conditions and other factors, including any additional authorizations approved by our shareholders.
As of February 25, 2025, we had approximately 31.1 million shares remaining under the current authorization. The timing and amounts of additional shares repurchased, if any, will be determined based on our evaluation of market conditions and other factors, including any additional authorizations approved by our shareholders.
CRITICAL ACCOUNTING POLICIES AND ESTIMATES Management applies those accounting policies that it believes best reflect the underlying business and economic events, consistent with accounting principles generally accepted in the U.S., see Note 2 to the Consolidated Financial Statements.
See Note 4 to the Consolidated Financial Statements for additional related party disclosures. CRITICAL ACCOUNTING POLICIES AND ESTIMATES Management applies those accounting policies that it believes best reflect the underlying business and economic events, consistent with accounting principles generally accepted in the U.S., see Note 2 to the Consolidated Financial Statements.
During the fourth quarter of 2022, management performed a qualitative impairment assessment of our reporting units, which indicated that it was more likely than not that the fair value of our reporting units was greater than their carrying value including goodwill. Accordingly, a quantitative goodwill impairment test was not required.
In the fourth quarter of 2024, we performed a qualitative impairment assessment of our reporting units, which indicated that it was more likely than not that the fair value of our reporting units was greater than their carrying value including goodwill. Accordingly, a quantitative goodwill impairment test was not required.
The weighted average discount rate used to measure obligations for non-U.S. plans at December 31, 2023, was 4.00%, reflecting market interest rates. The discount rates in effect at December 31, 2023 will be used to measure net periodic benefit cost during 2024.
The weighted average discount rate used to measure obligations for non-U.S. plans at December 31, 2024, was 3.66%, reflecting market interest rates. The discount rates in effect at December 31, 2024 will be used to measure net periodic benefit cost during 2025.
Cash and Liquid Investments As of December 31, 2023, we had Cash and cash equivalents totaling $3,390 million, which includes $1,816 million in jurisdictions outside of the U.S., primarily held within the European Union and the United Kingdom. There are currently no legal or economic restrictions that would materially impede our transfers of cash.
Cash and Liquid Investments As of December 31, 2024, we had Cash and cash equivalents totaling $3,375 million, which includes $1,172 million in jurisdictions outside of the U.S., primarily held within the European Union. There are currently no legal or economic restrictions that would materially impede our transfers of cash.
Comprehensive Income— Comprehensive income decreased by $2,303 million in 2023 compared to 2022, primarily due to a decrease in net income. The activities from the remaining components of Comprehensive income are discussed below.
Comprehensive Income— Comprehensive income decreased by $706 million in 2024 compared to 2023, primarily due to a decrease in net income. The activities from the remaining components of Comprehensive income are discussed below.
For more information regarding our debt arrangements, lease obligations, pension and other post-retirement benefits and income taxes, see Notes 12, 13, 15 and 17 to the Consolidated Financial Statements, respectively.
For more information regarding our debt arrangements, lease obligations, pension and other post-retirement benefits and income taxes, see Notes 11, 12, 14 and 16 to the Consolidated Financial Statements, respectively.
We had total unused availability under our credit facilities of $4,150 million at December 31, 2023, which included the following: • $3,250 million under our $3,250 million Senior Revolving Credit Facility, which backs our $2,500 million commercial paper program.
We had total unused availability under our credit facilities of $4,650 million at December 31, 2024, which included the following: • $3,750 million under our $3,750 million Senior Revolving Credit Facility. This facility backs our $2,500 million commercial paper program.
ACCOUNTING AND REPORTING CHANGES For a discussion of the potential impact of new accounting pronouncements on our Consolidated Financial Statements, see Note 2 to the Consolidated Financial Statements. 57 Table of Conte nts
ACCOUNTING AND REPORTING CHANGES For a discussion of the potential impact of new accounting pronouncements on our Consolidated Financial Statements, see Note 2 to the Consolidated Financial Statements. 52 Table of Conten ts
Goodwill —As of December 31, 2023, we had goodwill of $1,647 million, primarily relating to the acquisition of A.
Goodwill —As of December 31, 2024, we had goodwill of $1,561 million, primarily relating to the acquisition of A.
Credit Arrangements At December 31, 2023, we had total debt, including current maturities, of $11,232 million, and $171 million of outstanding letters of credit, bank guarantees and surety bonds issued under uncommitted credit facilities.
Credit Arrangements At December 31, 2024, we had total debt, including current maturities, of $11,149 million. Additionally, we had $174 million of outstanding letters of credit, bank guarantees and surety bonds issued under uncommitted credit facilities.
See Notes 8 and 21 to the Consolidated Financial Statements. 54 Table of Conte nts An estimate of the sensitivity to net income resulting from impairment calculations is not practicable, given the numerous assumptions, including pricing, volumes and discount rates, which could materially affect our estimates.
See Notes 7 and 20 to the Consolidated Financial Statements. 49 Table of Conten ts An estimate of the sensitivity to net income resulting from impairment calculations is not practicable, given the numerous assumptions, including pricing, volumes and discount rates, which could materially affect our estimates.
Ethylene Raw Materials —In Europe, naphtha is the primary raw material for our ethylene production and represents approximately 65% to 70% of the raw materials used in 2023 and 2022. The following table sets forth selected financial information for the O&P-EAI segment including Loss from equity investments, which is a component of EBITDA.
Ethylene Raw Materials —In Europe, naphtha is the primary raw material for our ethylene production and represented approximately 60% and 65% of the raw materials used in 2024 and 2023, respectively. 40 Table of Conten ts The following table sets forth selected financial information for the O&P-EAI segment including Loss from equity investments, which is a component of EBITDA.
Since our inventory consists of manufactured products derived from crude oil, natural gas, natural gas liquids and correlated materials, as well as the associated feedstocks and intermediate chemicals, our inventory market values are generally influenced by changes in the benchmark of crude oil and heavy liquid values and prices for manufactured finished goods.
Crude oil and natural gas prices are subject to many factors, including changes in economic conditions. 47 Table of Conten ts Since our inventory consists of manufactured products derived from crude oil, natural gas, natural gas liquids and correlated materials, as well as the associated feedstocks and intermediate chemicals, our inventory market values are generally influenced by changes in the benchmark of crude oil and heavy liquid values and prices for manufactured finished goods.
See Notes 14, 15 and 19 to the Consolidated Financial Statements for further discussions. 41 Table of Conte nts Segment Analysis We use earnings from continuing operations before interest, income taxes, and depreciation and amortization (“EBITDA”) as our measure of profitability for segment reporting purposes.
See Notes 13, 14 and 18 to the Consolidated Financial Statements for further discussions. 37 Table of Conten ts Segment Analysis We use earnings from continuing operations before interest, income taxes, and depreciation and amortization (“EBITDA”) as our measure of profitability for segment reporting purposes.
Upon settlement of these foreign currency contracts, we paid €750 million ($820 million at the expiry spot rate) to our counterparties and received $903 million from our counterparties. In 2022, foreign currency contracts with an aggregate notional value of €500 million expired.
In 2024, foreign currency contracts with an aggregate notional value of €850 million expired. Upon settlement of these foreign currency contracts, we paid €850 million ($921 million at the expiry spot rate) to our counterparties and received $967 million from our counterparties. In 2023, foreign currency contracts with an aggregate notional value of €750 million expired.
The following table presents the reconciliation of Net Income to EBITDA for each of the periods presented: Year Ended December 31, Millions of U.S. dollars 2023 2022 Net income $ 2,121 $ 3,889 Loss from discontinued operations, net of tax 5 5 Income from continuing operations 2,126 3,894 Provision for income taxes 501 882 Depreciation and amortization 1,534 1,267 Interest expense, net 348 258 EBITDA $ 4,509 $ 6,301 42 Table of Conte nts Our continuing operations are managed through six reportable segments: O&P-Americas, O&P-EAI, I&D, APS, Refining and Technology.
The following table presents the reconciliation of Net Income to EBITDA for each of the periods presented: Year Ended December 31, Millions of dollars 2024 2023 Net income $ 1,367 $ 2,121 (Income) loss from discontinued operations, net of tax (4) 5 Income from continuing operations 1,363 2,126 Provision for income taxes 240 501 Depreciation and amortization 1,522 1,534 Interest expense, net 331 348 EBITDA $ 3,456 $ 4,509 Our continuing operations are managed through six reportable segments: O&P-Americas, O&P-EAI, I&D, APS, Refining and Technology.
In the fourth quarter of 2023, we performed a quantitative impairment assessment for our reporting units within our Advanced Polymer Solutions segment and a qualitative impairment assessment of our other reporting units, which indicated that the fair value of our reporting units was greater than their carrying value including goodwill.
In the fourth quarter of 2023, management performed a quantitative impairment assessment for our reporting units within our APS segment and a qualitative impairment assessment of our other reporting units, which indicated that the fair values of our reporting units were greater than their carrying values, including goodwill.
Investment returns that are recognized currently in net income represent the expected long-term rate of return on plan assets applied to a market-related value of plan assets, which is defined as the market value of assets.
The net periodic benefit cost of pension benefits included in expense is affected by the expected long-term rate of return on plan assets assumption. Investment returns that are recognized currently in net income represent the expected long-term rate of return on plan assets applied to a market-related value of plan assets, which is defined as the market value of assets.
This discount rate is also compared to recent observable market transactions, if possible. Equity Method Investments Impairment —Investments in nonconsolidated entities accounted for under the equity method are assessed for impairment when there are indicators of a loss in value, such as a lack of sustained earnings capacity or a current fair value less than the investment’s carrying amount.
Equity Method Investments Impairment —Investments in nonconsolidated entities accounted for under the equity method are assessed for impairment when there are indicators of a loss in value, such as a lack of sustained earnings capacity or a current fair value less than the investment’s carrying amount.
Additionally, in 2023 and 2022, we made payments of $211 million and $420 million to repurchase outstanding ordinary shares, respectively. For additional information related to our share repurchases and dividend payments, see Note 19 to the Consolidated Financial Statements. 49 Table of Conte nts In 2023, we issued $500 million of 5.625% guaranteed notes due 2033.
Additionally, in 2024 and 2023, we made payments of $195 million and $211 million to repurchase outstanding ordinary shares, respectively. For additional information related to our share repurchases and dividend payments, see Note 18 to the Consolidated Financial Statements. In 2024, we issued $750 million of 5.5% guaranteed notes due 2034.
Impairments —During 2023, we recognized non-cash impairment charges of $518 million, primarily consisting of a goodwill impairment charge of $252 million in our APS segment and an impairment charge of $192 million related to our European PO joint venture recognized in our I&D segment.
During 2023, we recognized non-cash impairment charges of $518 million, primarily consisting of a goodwill impairment charge of $252 million in our APS segment and an impairment charge of $192 million related to our European PO joint venture recognized in our I&D segment. See Notes 7, 8 and 20 to the Consolidated Financial Statements for additional information regarding impairment charges.
At the end of 2023, we estimated VEP benefits to have a year-end annual run rate of approximately $300 million of Net income which, after adding back income taxes and depreciation and amortization of $75 million and $25 million, respectively, results in approximately $400 million of recurring annual EBITDA, which exceeded our original expectations.
At the end of 2024, we estimated VEP benefits to have a year-end annual run rate of approximately $610 million of Net income which, after adding back income taxes and depreciation and amortization of $155 million and $35 million, respectively, results in approximately $800 million of recurring annual EBITDA.
Foreign currency translations increased Comprehensive income by $196 million in 2023 compared to 2022, primarily due to the weakening of the U.S. dollar relative to the euro and the British pound sterling in 2023, offset by the effective portion of our net investment hedges.
Foreign currency translations decreased Comprehensive income by $242 million in 2024 compared to 2023, primarily due to the strengthening of the U.S. dollar relative to the euro in 2024, offset by the effective portion of our net investment hedges.
Projected benefit obligations at December 31, 2023 $ 1,155 $ 1,363 $ — $ — Projected net periodic pension costs in 2024 — — 69 54 Discount rate increases by 100 basis points (95) (172) (7) (6) Discount rate decreases by 100 basis points 112 200 8 7 The sensitivity of our post-retirement benefit plans obligations and net periodic benefit costs to changes in actuarial assumptions are reflected in the following table: Effects on Benefit Obligations in 2023 Effects on Net Periodic Benefit Costs in 2024 Millions of dollars U.S.
Projected benefit obligations at December 31, 2024 $ 1,232 $ 1,389 $ — $ — Projected net periodic pension costs in 2025 — — 59 54 Discount rate increases by 100 basis points (101) (176) (7) (5) Discount rate decreases by 100 basis points 120 205 9 7 The sensitivity of our post-retirement benefit plans obligations and net periodic benefit costs to changes in actuarial assumptions are reflected in the following table: Effects on Benefit Obligations in 2024 Effects on Net Periodic Benefit Costs in 2025 Millions of dollars U.S.
Deferred tax assets and liabilities are determined based on temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis, and are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse.
Deferred tax assets and liabilities are determined based on temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis and are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to reverse. 51 Table of Conten ts We recognize future tax benefits to the extent that the realization of these benefits is more likely than not.
Intersegment eliminations and items that are not directly related or allocated to business operations, such as foreign exchange gains (losses) and components of pension and other post-retirement benefit costs other than service cost, are included in “Other.” For additional information related to our operating segments, as well as a reconciliation of EBITDA to its nearest generally accepted accounting principles (“GAAP”) measure, Income from continuing operations before income taxes, see Note 21 to our Consolidated Financial Statements.
Intersegment eliminations and items that are not directly related or allocated to business operations, such as foreign exchange gains or losses and components of pension and other post-retirement benefits other than service costs, are included in “Other.” See the table below for a reconciliation of EBITDA to its nearest generally accepted accounting principles (“GAAP”) measure.
We recognize future tax benefits to the extent that the realization of these benefits is more likely than not. Our current provision for income taxes is impacted by the recognition and release of valuation allowances related to net deferred tax assets in certain jurisdictions.
Our current provision for income taxes is impacted by the recognition and release of valuation allowances related to net deferred tax assets in certain jurisdictions.
Given its performance in 2023, we anticipate that our VEP will achieve a 2024 year-end annual run rate of approximately $445 million of Net income, which, after adding back income taxes and depreciation and amortization of approximately $110 million and $45 million, respectively, results in approximately $600 million of recurring annual EBITDA.
We anticipate that our VEP will achieve a 2025 year-end annual run rate of approximately $760 million of Net income, which, after adding back income taxes and depreciation and amortization of approximately $190 million and $50 million, respectively, results in approximately $1,000 million of recurring annual EBITDA.
During 2023, we recognized a non-cash goodwill impairment charge of $252 million after the effect of moving our Catalloy and polybutene-1 businesses from our APS segment and reintegrating them into our O&P-Americas and O&P-EAI segments. This impairment charge resulted in a 219% decrease in EBITDA. See Note 8 to the Consolidated Financial Statements for additional information.
EBITDA —EBITDA increased in 2024 by $216 million, or 133%, compared to 2023. During 2023, we recognized a non-cash goodwill impairment charge of $252 million after the effect of moving our Catalloy and polybutene-1 businesses from our APS segment and reintegrating them into our O&P-Americas and O&P-EAI segments.
Year Ended December 31, Millions of dollars 2023 2022 Sales and other operating revenues $ 41,107 $ 50,451 Cost of sales 35,849 43,847 Impairments 518 69 Selling, general and administrative expenses 1,557 1,310 Research and development expenses 130 124 Operating income 3,053 5,101 Interest expense (477) (287) Interest income 129 29 Other expense, net (58) (72) (Loss) income from equity investments (20) 5 Income from continuing operations before income taxes 2,627 4,776 Provision for income taxes 501 882 Income from continuing operations 2,126 3,894 Loss from discontinued operations, net of tax (5) (5) Net income 2,121 3,889 Other comprehensive income (loss), net of tax – Financial derivatives (80) 208 Defined benefit pension and other postretirement benefit plans (97) 346 Foreign currency translations 73 (123) Total other comprehensive (loss) income, net of tax (104) 431 Comprehensive income $ 2,017 $ 4,320 RESULTS OF OPERATIONS Revenues —Revenues decreased by $9,344 million, or 19%, in 2023 compared to 2022.
Year Ended December 31, Millions of dollars 2024 2023 Sales and other operating revenues $ 40,302 $ 41,107 Cost of sales 35,738 35,849 Impairments 949 518 Selling, general and administrative expenses 1,663 1,557 Research and development expenses 135 130 Operating income 1,817 3,053 Interest expense (481) (477) Interest income 150 129 Gain on sale of business 284 — Other income (expense), net 50 (58) Loss from equity investments (217) (20) Income from continuing operations before income taxes 1,603 2,627 Provision for income taxes 240 501 Income from continuing operations 1,363 2,126 Income (loss) from discontinued operations, net of tax 4 (5) Net income 1,367 2,121 Other comprehensive income (loss), net of tax – Financial derivatives 115 (80) Defined benefit pension and other postretirement benefit plans (2) (97) Foreign currency translations (169) 73 Total other comprehensive income (loss), net of tax (56) (104) Comprehensive income $ 1,311 $ 2,017 RESULTS OF OPERATIONS Revenues —Revenues decreased by $805 million, or 2%, in 2024 compared to 2023.
Approximately half of our profit-generating growth project budget, or $400 million, is for projects that support our sustainability goals. Cash Requirements from Contractual and Other Obligations As part of our ongoing operations, we enter into contractual arrangements that may require us to make future cash payments under certain circumstances.
Cash Requirements from Contractual and Other Obligations As part of our ongoing operations, we enter into contractual arrangements that may require us to make future cash payments under certain circumstances.
Year Ended December 31, Millions of dollars 2023 2022 Sales and other operating revenues $ 3,698 $ 4,202 Loss from equity investments (1) — EBITDA (162) 115 Revenues —Revenues decreased in 2023 by $504 million, or 12%, compared to 2022. Average sales price declines resulted in an 11% decrease in revenue as a result of lower demand.
Year Ended December 31, Millions of dollars 2024 2023 Sales and other operating revenues $ 3,634 $ 3,698 Loss from equity investments — (1) EBITDA 54 (162) Revenues —Revenues decreased in 2024 by $64 million, or 2%, compared to 2023 as a result of lower average sales prices.
At December 31, 2023 we had no borrowings or letters of credit outstanding under this facility. 50 Table of Conte nts At any time and from time to time, we may repay or redeem our outstanding debt, including purchases of our outstanding bonds in the open market, through privately negotiated transactions or a combination thereof, in each case using cash and cash equivalents, cash from our short-term investments, cash from operating activities, proceeds from the issuance of debt or proceeds from asset divestitures.
See Note 11 to the Consolidated Financial Statements for additional details. 45 Table of Conten ts At any time and from time to time, we may repay or redeem our outstanding debt, including purchases of our outstanding bonds in the open market, through privately negotiated transactions or a combination thereof, in each case using cash and cash equivalents, cash from our short-term investments, cash from operating activities, proceeds from the issuance of debt or proceeds from asset divestitures.
Upon settlement of these foreign currency contracts, we paid €500 million ($501 million at the expiry spot rate) to our counterparties and received $614 million from our counterparties. Financing Activities —We made dividend payments totaling $1,610 million and $3,246 million, in 2023 and 2022, respectively. The 2022 dividend payments included a special dividend of $5.20 per share totaling $1,704 million.
Upon settlement of these foreign currency contracts, we paid €750 million ($820 million at the expiry spot rate) to our counterparties and received $903 million from our counterparties. Financing Activities —We made dividend payments totaling $1,720 million and $1,610 million, in 2024 and 2023, respectively.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2022 as reported in Exhibit 99.1 to the Current Report on form 8-K of the Company filed with the Securities and Exchange Commission on May 12, 2023 and is incorporated herein by reference.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2023 which was filed with the Securities and Exchange Commission on February 22, 2024 of which Item 7 is incorporated herein by reference.
Availability under this facility is subject to a borrowing base of eligible receivables, which is reduced by outstanding borrowings and letters of credit, if any.
Availability under this facility is subject to a borrowing base of eligible receivables, which is reduced by outstanding borrowings and letters of credit, if any. At December 31, 2024, we had no borrowings or letters of credit outstanding under this facility. In 2024, we amended some terms of our credit agreements.
Although prices of crude-based liquids and natural gas liquids are generally related to crude oil and natural gas prices, during specific periods the relationships among these materials and benchmarks may vary significantly.
Although prices of crude-based liquids and natural gas liquids are generally related to crude oil and natural gas prices, during specific periods the relationships among these materials and benchmarks may vary significantly. Ethane made up approximately 75% and 70% of the raw materials used in our North American crackers in 2024 and 2023, respectively.
In 2022, the main components of working capital provided $450 million of cash driven by a decrease in Accounts receivable, partially offset by a decrease in Accounts payable. The decrease in Accounts receivable was primarily due to lower revenues across most businesses primarily driven by lower average sales prices.
In 2024, the main components of working capital provided $30 million of cash driven by a decrease in Accounts receivable and Inventories, partially offset by a decrease in Accounts payable. The decrease in Accounts receivable was due to lower average sales prices coupled with timing of sales and customer payments.
The weighted average expected long-term rate of return on assets in our U.S. plans of 7.25% is based on the average level of earnings that our independent pension investment advisor advised could be expected to be earned over time.
The expected rate of return on plan assets is a longer-term rate and is expected to change less frequently than the current assumed discount rate, reflecting long-term market expectations, rather than current fluctuations in market conditions. 50 Table of Conten ts The weighted average expected long-term rate of return on assets in our U.S. plans of 7.25% is based on the average level of earnings that our independent pension investment advisor advised could be expected to be earned over time.
These revenues are offset in part by the costs incurred in the production of catalysts, licensing and services activities and research and development (“R&D”) activities. In 2023 and 2022, our Technology segment incurred approximately 50% to 55% of all R&D costs.
Technology Segment Overview —Our Technology segment recognizes revenues related to the sale of polyolefin catalysts and the licensing of chemical and polyolefin process technologies. These revenues are offset in part by the costs incurred in the production of catalysts, licensing and services activities and research and development (“R&D”) activities.
The benefit obligation and the net periodic benefit cost of other post-retirement medical benefits are also measured based on assumed rates of future increase in the per capita cost of covered health care benefits.
The benefit obligation and the net periodic benefit cost of other post-retirement medical benefits are also measured based on assumed rates of future increase in the per capita cost of covered health care benefits. As of December 31, 2024, the assumed rate of increase for our U.S. plans was 6.5%, decreasing to 4.5% in 2033 and thereafter.
In 2023, the main components of working capital provided $269 million of cash driven by a decrease in Accounts receivable and an increase in Accounts payable. The decrease in Accounts receivable was primarily due to lower revenues in our O&P-Americas, O&P-EAI and APS segments, primarily driven by lower average sales prices.
The decrease in Accounts receivable was primarily due to lower revenues in our O&P-Americas, O&P-EAI and APS segments, primarily driven by lower average sales prices. The increase in Accounts payable was primarily driven by higher feedstock and energy costs in our O&P-Americas segment.
Year Ended December 31, Millions of dollars 2023 2022 Sales and other operating revenues $ 9,714 $ 11,893 EBITDA 379 921 Thousands of barrels per day Heavy crude oil processing rates 237 238 Market margins, dollars per barrel Brent - 2-1-1 $ 25.71 $ 33.62 Brent - Maya differential 13.26 11.71 Total Maya 2-1-1 $ 38.97 $ 45.33 47 Table of Conte nts Revenues —Revenues decreased by $2,179 million, or 18%, in 2023 compared to 2022.
Year Ended December 31, Millions of dollars 2024 2023 Sales and other operating revenues $ 8,559 $ 9,714 EBITDA (60) 379 Thousands of barrels per day Heavy crude oil processing rates 237 237 Market margins, dollars per barrel Brent - 2-1-1 $ 16.16 $ 25.71 Brent - Maya differential 11.49 13.26 Total Maya 2-1-1 $ 27.65 $ 38.97 Revenues —Revenues decreased by $1,155 million, or 12%, in 2024 compared to 2023 driven by lower product prices reflecting lower margins on refined products. 42 Table of Conten ts EBITDA —EBITDA decreased by $439 million or 116%, in 2024 compared to 2023.
Higher licensing revenues resulting from more contracts reaching significant milestones drove a 1% increase in revenue. EBITDA —EBITDA in 2023 increased by $9 million, or 2%, compared to 2022. Higher catalyst margins resulted in a 5% increase in EBITDA.
Higher catalyst prices drove a 1% increase in revenues. Lower catalyst volumes resulting from lower demand drove a 3% decrease in revenues. EBITDA —EBITDA in 2024 increased by $4 million, or 1%, compared to 2023. Licensing results led to a 6% increase in EBITDA resulting from more contracts reaching significant milestones.
Defined benefit pension and other postretirement benefit plans led to a decrease in Comprehensive income of $443 million in 2023 compared to 2022, primarily due to actuarial losses resulting from lower-than-expected asset returns combined with the absence of pre-tax pension settlements in 2023.
Defined benefit pension and other postretirement benefit plans led to an increase in Comprehensive income of $95 million in 2024 compared to 2023, primarily due to actuarial gains resulting from higher-than-expected asset returns offset by a decrease in discount rates.
Year Ended December 31, Millions of dollars 2023 2022 Sales and other operating revenues $ 11,086 $ 12,950 Loss from equity investments (13) (25) EBITDA 1,679 1,872 Revenues —Revenues decreased by $1,864 million, or 14%, in 2023 compared to 2022. Lower average sales prices resulted in a 20% decrease in revenue as a result of lower demand.
Year Ended December 31, Millions of dollars 2024 2023 Sales and other operating revenues $ 10,424 $ 11,086 Loss from equity investments (13) (13) EBITDA 1,664 1,679 Revenues —Revenues decreased by $662 million, or 6%, in 2024 compared to 2023 driven by lower average sales prices for oxyfuels and related products as a result of lower gasoline crack spreads and blend premiums.
These arrangements largely relate to product off-take agreements with a joint venture located in Poland . No material shortfall was paid for quantities not taken under these contracts in 2023.
We also have purchase obligations under take-or-pay agreements which require us to either buy and take delivery of a minimum quantity of goods or to pay for any shortfall. These arrangements largely relate to product off-take agreements with a joint venture located in Poland . No material shortfall was paid for quantities not taken under these contracts in 2024.
Favorable foreign exchange impacts resulted in an EBITDA increase of 3%. 48 Table of Conte nts FINANCIAL CONDITION Operating, investing and financing activities of continuing operations, which are discussed below, are presented in the following table: Year Ended December 31, Millions of dollars 2023 2022 Cash provided by (used in): Operating activities $ 4,942 $ 6,119 Investing activities (1,777) (1,977) Financing activities (1,950) (3,407) Operating Activities —Cash provided by operating activities of $4,942 million in 2023 primarily reflected earnings adjusted for non-cash items and cash used by the main components of working capital–Accounts receivable, Inventories and Accounts payable.
Lower catalyst volumes driven by lower demand resulted in a 4% decrease in EBITDA. 43 Table of Conten ts FINANCIAL CONDITION The following table summarizes operating, investing and financing cash flow activities: Year Ended December 31, Millions of dollars 2024 2023 Cash provided by (used in): Operating activities $ 3,819 $ 4,942 Investing activities (1,853) (1,777) Financing activities (1,895) (1,950) Operating Activities —Cash provided by operating activities of $3,819 million in 2024 primarily reflected earnings adjusted for non-cash items and cash used by the main components of working capital–Accounts receivable, Inventories and Accounts payable.
Ethane made up approximately 70% of the raw materials used in our North American crackers in 2023 and 2022. 44 Table of Conte nts The following table sets forth selected financial information for the O&P-Americas segment including Income from equity investments, which is a component of EBITDA.
The following table sets forth selected financial information for the O&P-Americas segment including Income from equity investments, which is a component of EBITDA.
RELATED PARTY TRANSACTIONS We have related party transactions with our joint venture partners. We believe that such transactions are effected on terms substantially no more or less favorable than those that would have been agreed upon by unrelated parties on an arm’s length basis. See Note 5 to the Consolidated Financial Statements for additional related party disclosures.
We estimate incurring one-time costs of $200 million in 2025 related to our Value Enhancement Program. RELATED PARTY TRANSACTIONS We have related party transactions with our joint ventures. We believe that such transactions are affected on terms substantially no more or less favorable than those that would have been agreed upon by unrelated parties on an arm’s length basis.
Year Ended December 31, Millions of dollars 2023 2022 Sales and other operating revenues $ 11,280 $ 14,480 Income from equity investments 49 98 EBITDA 2,303 2,865 Revenues —Revenues decreased by $3,200 million, or 22%, in 2023 compared to 2022. Lower average sales prices resulted in a 23% decrease in revenue primarily driven by increased market supply and lower demand.
Year Ended December 31, Millions of dollars 2024 2023 Sales and other operating revenues $ 11,533 $ 11,280 Income from equity investments 13 49 EBITDA 2,445 2,303 Revenues —Revenues increased by $253 million, or 2%, in 2024 compared to 2023. Higher average sales prices across most of our products resulted in a 5% increase in revenue.
The increase in Accounts payable was primarily driven by higher feedstock and energy costs in our O&P-Americas segment. Cash provided by operating activities of $6,119 million in 2022 primarily reflected earnings adjusted for non-cash items and cash provided by the main components of working capital.
Cash provided by operating activities of $4,942 million in 2023 primarily reflected earnings adjusted for non-cash items and cash provided by the main components of working capital. In 2023, the main components of working capital provided $269 million of cash driven by a decrease in Accounts receivable and an increase in Accounts payable.
“Maya” is a heavy sour crude oil grade produced in Mexico that is a relevant benchmark for heavy sour crude oils in the U.S. Gulf Coast market. References to industry benchmarks for refining market margins are to industry prices reported by Platts, a division of S&P Global.
“Brent” is a light sweet crude oil and is one of the main benchmark prices for purchases of oil worldwide. “Maya” is a heavy sour crude oil grade produced in Mexico that is a relevant benchmark for heavy sour crude oils in the U.S. Gulf Coast market.
Segment results were relatively unchanged as improvements in our oxyfuels and related products results were offset by lower margins for propylene oxide and derivatives and intermediate chemicals. The following table sets forth selected financial information for the I&D segment including Loss from equity investments, which is a component of EBITDA.
Intermediates and Derivatives Segment Overview —EBITDA decreased in 2024 compared to 2023, primarily driven by lower oxyfuels and related products margins as a result of lower crude oil and gasoline pricing combined with lower blend premiums. The following table sets forth selected financial information for the I&D segment including Loss from equity investments, which is a component of EBITDA.
Year Ended December 31, Millions of dollars 2023 2022 Sales and other operating revenues $ 10,479 $ 13,455 Loss from equity investments (55) (68) EBITDA (9) 178 Revenues —Revenues decreased by $2,976 million, or 22%, in 2023 compared to 2022.
Year Ended December 31, Millions of dollars 2024 2023 Sales and other operating revenues $ 10,867 $ 10,479 Loss from equity investments (217) (55) EBITDA (991) (9) Revenues —Revenues increased by $388 million, or 4%, in 2024 compared to 2023. Higher average sales prices and volumes each resulted in a 2% increase in revenue primarily due to higher demand.
During 2023, we recognized a non-cash impairment charge of $192 million related to our equity investment in the European PO joint venture resulting in a 10% decrease in EBITDA. See Note 9 to the Consolidated Financial Statements for additional information. Excluding the impact of the impairment discussed above, segment results remained relatively unchanged.
During 2023, we recognized a non-cash impairment charge of $192 million related to our equity investment in the European PO joint venture.
The following table sets forth selected financial information and heavy crude oil processing rates for the Refining segment and the U.S. refining market margins for the applicable periods. “Brent” is a light sweet crude oil and is one of the main benchmark prices for purchases of oil worldwide.
Refining Segment Overview —EBITDA decreased in 2024 relative to 2023 primarily due to lower margins. The following table sets forth selected financial information and heavy crude oil processing rates for the Refining segment and the U.S. refining market margins for the applicable periods.
When valued using a contract price as of December 31, 2023, these commitments represent approximately 5% of our annual Cost of sales with a weighted average remaining term of 14 years. CURRENT BUSINESS OUTLOOK In the first quarter of 2024, seasonally slow demand and economic uncertainty provide headwinds for most businesses.
When valued using a contract price as of December 31, 2024, these commitments represent approximately 5% of our annual Cost of sales with a weighted average remaining term of 14 years. 46 Table of Conten ts CURRENT BUSINESS OUTLOOK In 2025 we remain watchful and prepared for the macroeconomic catalysts that will eventually drive restocking of supply chains, improve demand for durable goods and support a more broad-based economic recovery.
We incurred one-time costs of approximately $200 million in 2023 to achieve this milestone.
We incurred one-time costs of approximately $200 million per year in 2023 and 2024 related to our Value Enhancement Program.
In 2023, Operating income decreased for our Refining, O&P-Americas, I&D, APS and O&P-EAI segments by $668 million, $541 million, $342 million, $277 million and $235 million, respectively. Operating income for our Technology segment increased by $3 million in 2023 compared to 2022. Results for each of our business segments are discussed further in the Segment Analysis section below.
In 2024, Operating income decreased for our O&P-EAI, Refining, and I&D segments by $848 million, $434 million and $311 million, respectively. Operating income for our APS, O&P-Americas and Technology segments increased by $213 million, $140 million and $4 million, respectively, in 2024 compared to 2023.
Assuming that contractual minimum volumes are purchased at contract prices as of December 31, 2023, these commitments represent approximately 20% of our annual Cost of sales with a weighted average remaining term of 7 years. 51 Table of Conte nts We also have purchase obligations under take-or-pay agreements which require us to either buy and take delivery of a minimum quantity of goods or to pay for any shortfall.
Assuming that contractual minimum volumes are purchased at contract prices as of December 31, 2024, these commitments represent approximately 15% of our annual Cost of sales with a weighted average remaining term of 8 years.
Unless otherwise indicated, the “Company,” “we,” “us,” “our” or similar words are used to refer to LyondellBasell Industries N.V. together with its consolidated subsidiaries (“LyondellBasell N.V.”). Effective January 1, 2023, our Catalloy and polybutene-1 businesses were moved from the Advanced Polymer Solutions (“APS”) segment and reintegrated into the Olefins and Polyolefins-Americas (“O&P-Americas”) and Olefins and Polyolefins-Europe, Asia, International (“O&P-EAI”) segments.
Unless otherwise indicated, the “Company,” “we,” “us,” “our” or similar words are used to refer to LyondellBasell Industries N.V. together with its consolidated subsidiaries (“LyondellBasell N.V.”).
Favorable foreign exchange impacts resulted in a 1% increase in revenue. Cost of Sales —Cost of sales decreased by $7,998 million, or 18%, in 2023 compared to 2022. This decrease primarily related to lower feedstock and energy costs. Fluctuations in our cost of sales are generally driven by changes in feedstock and energy costs.
Lower average sales prices driven by lower demand resulted in a 2% decrease in revenues. Cost of Sales —Cost of sales remained relatively unchanged, in 2024 compared to 2023. Fluctuations in our cost of sales are generally driven by changes in feedstock and energy costs.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeOther (expense) income, net, in the Consolidated Statements of Income reflects net foreign currency losses of $34 million and $14 million in 2023 and 2022, respectively. As of December 31, 2023, our foreign currency contracts that are accounted for as economic hedges mature between January 2024 and January 2025, inclusively, and had an aggregate notional amount of $555 million.
Biggest changeAs of December 31, 2024, our foreign currency contracts that are accounted for as economic hedges mature between January 2025 and October 2025, inclusively, and have an aggregate notional amount of $772 million.
We enter foreign currency derivatives that are designated as net investment hedges to reduce the volatility in Shareholders’ equity resulting from translation adjustments associated with our net investments in foreign operations. We also enter foreign currency contracts that are designated as cash flow hedges to manage the variability in cash flows associated with intercompany debt balances.
We enter into foreign currency derivatives that are designated as net investment hedges to reduce the volatility in Shareholders’ equity resulting from translation adjustments associated with our net investments in foreign operations. We also enter into foreign currency contracts that are designated as cash flow hedges to manage the variability in cash flows associated with intercompany debt balances.
To minimize earnings at risk as part of our interest rate risk management strategy, we target to maintain floating-rate debt, through the use of interest rate swaps and issuance of variable-rate debt, equal to our cash and cash equivalents, as those assets earn interest based on floating-rates.
To minimize earnings at risk as part of our interest rate risk management strategy, we may target to maintain floating-rate debt, through the use of interest rate swaps and issuance of variable-rate debt, equal to our cash and cash equivalents, as those assets earn interest based on floating-rates.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk. See Note 14 to the Consolidated Financial Statements for further discussion of our management of commodity price risk, foreign exchange risk and interest rate risk. Commodity Price Risk —Prices for our products and raw materials are subject to changes in supply and demand.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk. See Note 13 to the Consolidated Financial Statements for further discussion of our management of commodity price risk, foreign exchange risk and interest rate risk. Commodity Price Risk —Prices for our products and raw materials are subject to changes in supply and demand.
By centralizing most of our foreign currency exposure into one subsidiary, we are able to take advantage of natural offsets thereby reducing the overall impact of changes in foreign currency rates on our earnings. 58 Table of Conte nts To minimize the effects of our net currency exchange exposures, we enter into forward exchange contracts and cross-currency swaps.
By centralizing most of our foreign currency exposure into one subsidiary, we are able to take advantage of natural offsets thereby reducing the overall impact of changes in foreign currency rates on our earnings. To minimize the effects of our net currency exchange exposures, we enter into forward exchange contracts and cross-currency swaps.
We estimate that a 10% change in market interest rates as of December 31, 2023 and 2022, would change the fair value of these interest rate swaps by approximately $14 million and $35 million, respectively. Variable-rate debt —At December 31, 2023, we have no borrowings under our Commercial Paper Program.
We estimate that a 10% change in market interest rates as of December 31, 2024 and 2023, would change the fair value of these interest rate swaps by approximately $24 million and $14 million, respectively. Variable-rate debt —At December 31, 2024, we have no borrowings under our Commercial Paper Program.
A 10% fluctuation compared to the U.S. dollar would have resulted in an additional impact to earnings of approximately $21 million and $17 million in 2023 and 2022, respectively. Interest Rate Risk —We are exposed to interest rate risk with respect to our fixed-rate and variable-rate debt.
A 10% fluctuation compared to the U.S. dollar would have resulted in an additional impact to earnings of approximately $68 million and $21 million in 2024 and 2023, respectively. Interest Rate Risk —We are exposed to interest rate risk with respect to our fixed-rate and variable-rate debt.
We also have available borrowing capacity under our $3,250 million Senior Revolving Credit Facility and our $900 million U.S. Receivables Facility. At December 31, 2023, there were no outstanding borrowings under these facilities.
We also have available borrowing capacity under our $3,750 million Senior Revolving Credit Facility and our $900 million U.S. Receivables Facility. At December 31, 2024, there were no outstanding borrowings under these facilities.
The table below illustrates the impact on other comprehensive income (loss) of a 10% fluctuation in the foreign currency rate associated with the hedges at December 31: Notional Amount 10% Variance on Foreign Currency Rate Impact on Other Comprehensive Loss Millions of euro/dollars 2023 2022 2023 2022 Net investment hedges: Cross currency basis swaps € 617 € 617 euro/U.S. dollar rate $ 70 $ 67 Cross currency swaps € 750 € 750 euro/U.S. dollar rate $ 81 $ 75 Forward exchange contracts € 1,550 € 1,350 euro/U.S. dollar rate $ 165 $ 138 Cash flow hedges: Cross currency swaps € 1,052 € 1,052 euro/U.S. dollar rate $ 117 $ 113 Some of our consolidated entities enter transactions that are not denominated in their functional currency.
The table below illustrates the impact on other comprehensive income (loss) of a 10% fluctuation in the foreign currency rate associated with the hedges at December 31: Notional Amount 10% Variance on Foreign Currency Rate Impact on Other Comprehensive Loss Millions of euro/dollars 2024 2023 2024 2023 Net investment hedges: Cross currency basis swaps € 617 € 617 euro/U.S. dollar rate $ 65 $ 70 Cross currency swaps € 750 € 750 euro/U.S. dollar rate $ 77 $ 81 Forward exchange contracts € 1,550 € 1,550 euro/U.S. dollar rate $ 158 $ 165 Cash flow hedges: Cross currency swaps € 268 € 1,052 euro/U.S. dollar rate $ 29 $ 117 Some of our consolidated entities enter transactions that are not denominated in their functional currency.
At December 31, 2023, after giving consideration to the fixed-rate debt that we have effectively converted to variable-rate debt, approximately 80% of our debt portfolio, on a gross basis, incurred interest at a fixed-rate and the remaining 20% of the portfolio incurred interest at a variable-rate.
At December 31, 2024, after giving consideration to the fixed-rate debt that we have effectively converted to variable-rate debt, approximately 81% of our debt portfolio, on a gross basis, incurred interest at a fixed-rate and the remaining 19% of the portfolio incurred interest at a variable-rate.
Based on our average variable-rate debt outstanding per year, we estimate that a 10% change in market interest rates as of December 31, 2023 and 2022 would not materially impact the fair value of these facilities. 59 Table of Conte nts
Based on our average variable-rate debt outstanding per year, we estimate that a 10% change in market interest rates as of December 31, 2024 and 2023 would not materially impact the fair value of these facilities. 54 Table of Conten ts
Pre-issuance interest rate —To mitigate the risk that benchmark interest rates may increase in connection with future financing activities, we adopted a pre-issuance interest rate strategy, under which we entered forward-starting interest rate swaps that are designated as cash flow hedges.
Pre-issuance interest rate —To mitigate the risk that benchmark interest rates may increase in connection with future financing activities, we adopted a pre-issuance interest rate strategy, under which we entered forward-starting interest rate swaps that were designated as cash flow hedges. There were no open forward-starting interest rate swaps contracts at December 31, 2024.
We estimate that a 10% change in commodity prices as of December 31, 2023, would change the fair value of our commodity derivative contracts by approximately $36 million; while a 10% change in commodity prices as of December 31, 2022, would not materially impact the fair values of our commodity derivative contracts.
We estimate that a 10% change in commodity prices as of December 31, 2024 and 2023, would change the fair value of our commodity derivative contracts by approximately $45 million and $36 million, respectively.
These interest rate swaps are designated as fair value hedges. At December 31, 2023 and 2022, the total notional amount of these interest rate swaps was $2,171 million and $2,164 million , respectively.
Fixed-rate debt —We may enter into interest rate swaps that effectively convert a portion of our fixed-rate debt to variable-rate debt. These interest rate swaps are designated as fair value hedges. At December 31, 2024 and 2023, the total notional amount of these interest rate swaps was $2,158 million and $2,171 million , respectively.
We also engage in short-term forward exchange contracts to manage our net exposure to foreign currencies as economic hedges. Changes in the fair value of these foreign currency contracts are reported in the Consolidated Statements of Income and offset the currency exchange results recognized on foreign currency balances.
We also engage in short-term forward exchange contracts to manage our net exposure to foreign currencies as economic hedges.
Removed
We estimate that a 10% change in market interest rates as of December 31, 2023 and 2022, would change the fair value of these forward-starting interest rate swaps by approximately $12 million and $23 million, respectively. Fixed-rate debt —We enter into interest rate swaps that effectively convert our fixed-rate debt to variable-rate debt.
Added
Changes in the fair value of these foreign currency contracts are reported in the Consolidated Statements of Income and offset the currency exchange results recognized on foreign currency balances. 53 Table of Conten ts Other income (expense), net, in the Consolidated Statements of Income reflects net foreign currency gains of $15 million and losses of $34 million in 2024 and 2023, respectively.

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