The Complete Petroleum Trading Guide:
From Supplier to Delivery

Not every seller claiming to have barrels is real. This guide walks you through the supplier vetting framework professionals use — company registration checks, certificate of product (COP) verification, past performance validation, and the refinery mandate chain. Learn how to distinguish legitimate principals from brokers masquerading as mandates, and what due diligence documentation to demand before signing any agreement.

Advance-fee fraud, fake SGS reports, non-existent mandates, and forged bank instruments cost buyers millions each year. This article catalogs the most common petroleum trading scams, the exact phrases and behaviors that signal fraud, and the verification steps that expose bad actors before money changes hands. If a deal feels too smooth, this checklist will show you why.

Who pays freight? Who carries the risk once cargo leaves the terminal? Delivery terms define the answer — and getting them wrong can cost you the entire deal. This guide explains Tank-to-Tank Transfer (TTT), Free On Board (FOB), and Cost Insurance Freight (CIF) in plain language, including how each affects pricing negotiations, insurance obligations, and bank instrument structure.

Letters of Credit and Standby Letters of Credit are the backbone of international petroleum payments — but banks issue them differently, and sellers accept them on different terms. This guide breaks down the MT700 LC, MT760 SBLC, and Deferred LC structures, explains how DLC protects both parties, and outlines the documentary requirements your bank will demand before issuing any instrument.

The Irrevocable Corporate Purchase Order (ICPO) and the Sales and Purchase Agreement (SPA) are the two documents that transform an inquiry into a binding deal. This procedures checklist covers what goes into each document, what sellers are allowed to verify before countersigning, and the exact sequence of steps from LOI to signed SPA — including the most common deal-killing mistakes at each stage.

Cargo vetting is where paper trades become real. This guide covers how SGS and similar inspection agencies verify petroleum cargo at the loading port, what documents are produced (Q&Q certificate, inspection report, ullage report), how vessel nomination works, and what buyers should look for in a vetting report to confirm they're receiving what they paid for.

Petroleum trade is one of the most heavily regulated industries on earth. This guide covers the licensing requirements for importers and exporters across major trade corridors, sanctions compliance (OFAC, EU), end-user certificates, and the Harmonized Tariff codes that affect your documentation. Non-compliance doesn't just cost fines — it can result in cargo seizure and criminal liability.

Storage terminals are where petroleum sits between production and delivery — and terminal operations are where disputes most often arise. This guide explains tank storage receipts (TSRs), how custody transfers work at the terminal gate, the role of the terminal operator in confirming product availability, and how storage costs, demurrage, and inspection fees are calculated and allocated in a typical deal.