Energy Transfer LP

4. INVENTORIES

Inventories consisted of the following:

Inventories consist principally of natural gas held in storage, NGLs and refined products, crude oil and spare parts, all of which are valued at the lower of cost or net realizable value utilizing the weighted-average cost method, except as described below.

Sunoco LP’s fuel inventories are stated at the lower of cost or market using the LIFO method. As of September 30, 2025 and December 31, 2024, Sunoco LP’s fuel inventory balance included lower of cost or market reserves of $285 million and $316 million, respectively. For the three and nine months ended September 30, 2025 and 2024, the Partnership’s consolidated income statements did not include any material amounts of income from the liquidation of Sunoco LP’s LIFO fuel inventory. For the three and nine months ended September 30, 2025, the Partnership’s cost of products sold included favorable inventory valuation adjustments of $10 million and $31 million, respectively, which increased net income. For the three and nine months ended September 30, 2024, the Partnership’s cost of sales included unfavorable inventory valuation adjustments of $197 million and $99 million, respectively, which decreased net income.