Petroleum Trade Terms & Documentation Glossary
Comprehensive Reference for Oil & Gas Trade Documentation
An expertly compiled glossary of key terms, abbreviations, and formal document titles used in global petroleum trading. This guide ensures accuracy, clarity, and standardization in contract drafting, negotiation, and procedural alignment.
Introduction
This glossary serves as a practical reference for professionals engaged in international petroleum trading. It consolidates essential trade terms, document types, procedural tools, and banking instruments into one accessible source. Whether you’re a buyer, seller, intermediary, or legal advisor, this document aims to clarify responsibilities, standardize language, and enhance compliance.
SECTION A: Buyer-Initiated Documents & Actions
Buyers often initiate key documents at the start of negotiations. These ensure readiness, transparency, and credibility during the procurement process:
- LOI – Letter of Intent: A non-binding document indicating the buyer’s interest in a future purchase.
- ICPO – Irrevocable Corporate Purchase Order: Confirms intent to purchase, including terms and financial details.
- POF – Proof of Funds: Confirms the buyer’s financial capacity to execute the transaction.
- RWA – Ready, Willing, and Able (MT799): A SWIFT message confirming buyer’s capability and willingness.
- DD – Due Diligence: Investigation and verification of the involved parties and documentation.
- CIS – Company Information Sheet: Provides full corporate details, including legal and banking info.
- EL – Endorsement Letter: Confirms authorization or readiness from third parties.
- DTA / DIP Test Authorization: Allows buyer to test fuel quality and quantity in storage tanks.
- UDTA – Unconditional Dip Test Authorization: Grants unrestricted access for testing before payment.
- ATB – Authority to Board: Authorizes buyer to board vessel for inspection.
- ETA – Estimated Time of Arrival: Notification of vessel’s expected arrival at destination.
SECTION B: Seller-Initiated Documents & Actions
Sellers provide critical confirmations and contract documents to secure commitments and demonstrate product readiness:
- SCO – Soft Corporate Offer: Non-binding offer outlining preliminary terms.
- FCO – Full Corporate Offer: Binding offer specifying exact terms and conditions of sale.
- SPA – Sale and Purchase Agreement: Formal contract between buyer and seller.
- POP – Proof of Product: Verifies the existence and availability of the product.
- PPOP – Partial Proof of Product: Incomplete documentation verifying product availability.
- ATS – Authority to Sell: Authorizes agents to sell products on behalf of refinery.
- ATSC – Authority to Sell and Collect: Grants the right to both sell and receive funds.
- ATV – Authority to Verify: Permits buyer reps to verify product on-site.
- TSA – Tank Storage Agreement: Contract to store petroleum in a designated tank farm.
- TSR – Tank Storage Receipt: Confirms physical storage of product with tank details.
- Injection Report: Proof of product injection into storage.
- TTVIAC – Tank to Vessel Injection Agreement Contract: Confirms transfer of fuel from tank to vessel.
- IPA – Injection Programming Agreement: Schedule agreement for product delivery into tanks.
- PAS Code – Port Authority Security Code: Code granting secure access to port storage data.
- Title Transfer Affidavit: Legal confirmation of product ownership transfer.
- MOU – Memorandum of Understanding: Pre-agreement defining intent and cooperative steps.
SECTION C: Mutual or Intermediary Documents
Several documents are either jointly handled or specific to agents, brokers, or facilitators. These ensure proper commission handling, transparency, and shared intent:
- NCND – Non-Circumvention and Non-Disclosure Agreement: Protects intermediaries and ensures confidentiality.
- IMFPA – Irrevocable Master Fee Protection Agreement: Secures commission structure for intermediaries.
- JVA – Joint Venture Agreement: Defines partnership terms for mutual business undertakings.
- R&E – Rolls & Extensions Contract: Extended SPA covering long-term supply periods.
- Trial – Trial Delivery: Initial shipment to validate supplier and product.
- Q&Q – Quantity and Quality Report: Lab-certified results on product specs.
- SGS Report: Inspection certificate from independent verifier.
- NOR – Notice of Readiness: States vessel is ready to load cargo.
- CI – Commercial Invoice: Official invoice for supplied goods.
- CPA – Charter Party Agreement: Agreement for vessel hire.
- SATCOM – Satellite Communications: Used by vessel captains for updates and authorization.
- S88 – Ship Passport: Technical ship file containing specifications and registry.
SECTION D: Logistics & Delivery Terms
Logistics terms define who is responsible at each stage of product movement. Clear definitions prevent disputes and delays:
- FOB – Free On Board: Seller’s responsibility ends at loading goods on vessel.
- CIF – Cost, Insurance, and Freight: Seller bears shipping and insurance to destination.
- ASWP – Any Safe World Port: Flexible CIF delivery to any secure port.
- Spot – Spot Transaction: Single shipment without recurring obligation.
- TTV – Tank to Vessel Transfer: Transfers product from tank farm to vessel.
- TTT – Tanker to Tank Transfer: Transfers from seller’s tank to buyer’s tank.
- TTO – Tank Take Over: Buyer assumes tank lease and its content.
- VTO – Vessel Take Over: Buyer takes ownership of product and vessel offshore.
- DIP & PAY – Dip and Pay: Buyer tests product and pays on verification.
SECTION E: Banking & Payment Terms
Banking instruments and payment messages are essential for compliance and security. Traders must understand their implications before execution:
- BCL – Bank Comfort Letter: States buyer’s bank supports their purchasing power.
- BG – Bank Guarantee: Guarantees funds are available and blocked.
- SBLC – Standby Letter of Credit: Guarantee of payment in event of buyer default.
- DLC – Documentary Letter of Credit: Conditional payment upon document submission.
- PB – Performance Bond: Ensures compensation if seller fails to perform.
- RB – Reference Bank: Bank providing financial background of a party.
- SWIFT MT103 – Cash Transfer: Direct wire transfer instruction.
- SWIFT MT199 – Bank-to-Bank Message: Free-format SWIFT communication.
- SWIFT MT760 – Financial Guarantee: Sends proof of guarantee through SWIFT.
Usage Guidelines
- This glossary aligns with ICC Incoterms, SWIFT protocols, and international petroleum trade standards.
- Terms have been categorized based on party responsibility to support documentation workflows.
- Legal teams should use definitions consistently to avoid ambiguities or conflicts.
- Professionals are encouraged to incorporate this glossary during contract negotiations.
- You may annex this document as an Exhibit of Terminologies in your SPA or FCO agreements.
Final Note
This glossary was created to support real-world use in petroleum trade and documentation. All terms have been verified and phrased with active language to improve readability and direct applicability across global trading scenarios.s.