Transaction procedure.

Full 5-step oil trade procedure: ICPO, POF, FCO, LOI, and SPA — explained by REYMOND Oil Mandate Broker.

1. 1

   Step 1

   ICPO — Irrevocable Corporate Purchase Order

   The buyer issues a formal, irrevocable purchase order to the seller's mandate confirming intent, quantity, product spec, and delivery terms.

2. 2

   Step 2

   POF — Proof of Funds

   Buyer provides banking confirmation of available funds sufficient to cover the first lifting. This may be a bank comfort letter, SWIFT MT799, or a blocked funds instrument.

3. 3

   Step 3

   FCO — Full Corporate Offer

   Once POF is verified, the seller issues a Full Corporate Offer — a binding proposal specifying product, price, quantity, delivery schedule, and inspection terms.

4. 4

   Step 4

   LOI — Letter of Intent

   The buyer countersigns the FCO with a Letter of Intent, confirming acceptance of the offer terms and readiness to proceed to contract.

5. 5

   Step 5

   SPA — Sales & Purchase Agreement

   Both principals execute the SPA — the binding contract covering all transaction terms. SGS or equivalent third-party inspection is arranged and cargo delivery proceeds.