Understanding the Process of Buying JET A-1 Fuel with Direct Access to Refineries

Buying JET A-1 fuel directly from refineries offers a unique opportunity for buyers to access quality product at competitive prices. With sellers ready to offer discounted pricing at $78 per barrel, understanding the buying process is essential to secure a smooth transaction. This guide walks you through the key steps involved in purchasing JET A-1 fuel, focusing on two main transaction options and what buyers need to prepare to complete the deal efficiently.

Fuel storage tanks at refinery terminal

Direct Access to Refineries and Discount Pricing

JET A-1 fuel is a kerosene-based aviation fuel widely used in commercial aircraft. Buying directly from refineries means bypassing middlemen, which often results in better pricing and more control over the supply chain. The current offer at $78 per barrel is competitive, especially when sellers are ready to deliver to the port of your choice or provide lifting options.

Buyers must have a Letter of Intent (LOI) ready to initiate the process. This document signals your serious intent to purchase and allows sellers to share their working procedures and banking details.

Option 1: FOB Tank to Tank Procedure

This option involves the transfer of fuel from the seller’s storage tanks at the port directly into the buyer’s tanks. The process includes several important steps:

• Issuing ICPO: The buyer sends an Irrevocable Corporate Purchase Order (ICPO) that includes the seller’s procedures, banking details, a scanned copy of the buyer’s passport, and a Tank Storage Agreement (TSA).

• Commercial Invoice: The seller issues a commercial invoice for the product in tanks at the port. Both buyer and logistics sign and return this invoice.

• Proof of Product (PPOP): The seller provides several documents to prove product availability and quality:

- GPS Coordinates and Tank Storage Receipt (TSR)

- Injection Report

- Unconditional Dip Test Authorization letter (DTA)

- Authorization to Sell and Collect (ATSC)

- Authorization to Verify (ATV)

- Fresh SGS Report from the seller’s tank

• NCNDA/IMFPA Agreement: Non-Circumvention, Non-Disclosure Agreement / International Master Fee Protection Agreement is signed by all intermediaries and the buyer.

• Inspection and Dip Test: The buyer arranges an SGS inspection at their expense and sends the TSR.

• Payment and Title Transfer: After a successful dip test, the product is injected into the buyer’s tanks. The buyer makes payment via MT103, and the seller transfers ownership.

  
  

This method ensures transparency and security for both parties, with clear documentation and verification steps.

Option 2: TTT/TTV Transaction Procedure (FOB Rotterdam/Houston)

This option is suitable for buyers who prefer to lift the product from major ports such as Rotterdam or Houston. The steps include:

• ICPO Submission: The buyer sends an ICPO after accepting the seller’s soft offer.

• Commercial Invoice: The seller issues a commercial invoice, which the buyer signs and returns along with a copy of their international passport.

• Readiness to Inject: The seller issues documents confirming readiness to inject the product, including UDTA and ATSC.

• Tank Extension and Dip Test: The buyer extends the seller’s tank for 3 to 5 days to conduct a dip test.

• TSR Invoice Payment: The buyer pays the tank storage receipt invoice for the dip test period via MT103.

• Quality and Quantity Execution: After payment confirmation, the buyer contacts the seller’s tank administrator to execute quality and quantity checks and register the product in the tank farm terminal.

  
  

This procedure offers flexibility for buyers who want to handle lifting at major ports and conduct thorough inspections before finalizing payment.

Oil tanker docked at port terminal for fuel lifting

Key Documents and Verification Steps

Successful transactions rely on proper documentation and verification. Here are the critical documents buyers should expect:

• ICPO: Confirms buyer’s intent and acceptance of seller’s terms.

• Commercial Invoice: Details product quantity, price, and delivery terms.

• PPOP Documents: Provide proof of product existence and quality.

• NCNDA/IMFPA: Protects all parties involved from circumvention and ensures fee protection.

• SGS Inspection Reports: Independent verification of product quality and quantity.

• Tank Storage Receipt (TSR): Confirms product storage and availability.

  
  

Buyers should carefully review these documents and conduct due diligence to avoid fraud and ensure product authenticity.

Preparing for Payment and Delivery

Payment is typically made via MT103, a secure bank transfer method that provides traceability. Buyers must ensure their bank details are ready and comply with seller requirements. Delivery can be arranged to the port of choice or through lifting at designated terminals.

Logistics planning is crucial. Buyers should coordinate with their logistics team to manage transportation from the port or terminal to their storage facilities. Clear communication with the seller’s tank administrator helps avoid delays during quality and quantity checks.

Fuel pump nozzle at airport refueling station

Final Thoughts on Buying JET A-1 Fuel Directly

Buying JET A-1 fuel directly from refineries at discounted prices requires understanding the detailed procedures and preparing the necessary documents. Whether you choose the FOB tank to tank procedure or the TTT/TTV transaction, following the outlined steps ensures a secure and transparent purchase.

Having your LOI ready and working closely with sellers who provide clear PPOP and inspection options will help you avoid common pitfalls. Always verify product quality through SGS inspections and confirm payment methods before finalizing the deal.