• Type: Light or heavy crude oil (client-specified).
• Sulfur Content: Sweet crude ≤ 0.5%; sour crude > 0.5%.
• API Gravity: Ranges from 25-45.
• Applications: Refining into petroleum products such as gasoline, diesel, and lubricants.

Packaging and Logistics:

• Transported in tankers with full compliance to IMO and regional regulations.

Common Transaction Procedures in Petroleum Trade:

Petroleum trade typically revolves around three primary transaction types:

• Legal aspects
• Financial risks
• Logistics and transport challenges
• Market-specific complexities

Ensuring Transparency and Security in International Petroleum Transactions for our buyers:

In international transactions involving the sale and purchase of petroleum products, a well-structured transaction procedure is critical. It defines each party's responsibilities, ensures transparency, and protects the interests of both buyers and sellers, minimizing risks and avoiding potential disputes.

Why Transaction Procedures Matter:

A clear and concise transaction procedure serves as the backbone of any successful deal. It considers the unique aspects of the transaction, adheres to market requirements, and follows international standards. Properly drafted procedures help prevent misunderstandings, mitigate risks, and pave the way for efficient operations.

Key Considerations in Drafting Procedures:

Crafting a robust transaction procedure involves attention to every nuance:

• 1.FOB (Free on Board): The seller delivers the goods at the port of departure, and the buyer assumes responsibility from there.
• 2.CIF (Cost, Insurance, and Freight): The seller delivers goods to the buyer’s port of destination, with added guarantees for delivery and payment security.
• 3.Vessel Takeover (Sailing Ship Redemption): The buyer purchases the ship and its cargo mid-journey, a hybrid model requiring heightened diligence.

Each procedure offers its own set of advantages and challenges. Below, we explore these processes in detail, with a special focus on CIF procedures, the most commonly used in large-scale international deals.

Spotlight on CIF Procedures:

CIF transactions require the seller to deliver goods to the buyer's port of destination, typically involving bank instruments like SBLCs, DLCs, or escrow accounts to ensure payment security. Trust between parties is paramount, but it is often challenged by two recurring issues:

• Sellers hesitate to share original product documents before confirming the buyer’s financial capacity.
• Buyers are cautious about freezing funds without verifying the seller's credibility.

To address these concerns, reputable suppliers should work with top-tier global banks, while buyers should thoroughly evaluate sellers' credentials and bank arrangements to avoid fraudulent schemes.

Fraud Prevention and Best Practices:

The oil and gas trade is highly lucrative but rife with fraud. Both buyers and sellers must take these precautions:

• Sellers: Verify the authenticity and solvency of buyers’ bank instruments, and prioritize working with trusted financial institutions.
• Buyers: Confirm the legitimacy of sellers’ product documents and the banks servicing their transactions. Consider trial shipments (e.g., FOB or floating ship purchases) before committing to larger deals.

Looking Ahead:

As global petroleum trade grows increasingly complex, vigilance and thorough due diligence remain key to mitigating risks. Whether dealing with CIF, FOB, or Vessel Takeover procedures, adopting clear processes and maintaining trust between parties are vital for long-term success.

At UNIKSALE Limited, we help businesses navigate the intricacies of international commodity transactions, ensuring secure, transparent, and efficient trade.

💼 Interested in learning more about safe transaction procedures or exploring opportunities in the petroleum trade? Contact us today!