A comprehensive guide to identifying fraudulent fuel offers, fake storage agreements, and non-viable transaction structures in physical petroleum trading.
Due to the high liquidity and worldwide demand for Ultra Low Sulfur Diesel (EN590 10 PPM), the physical intermediary market attracts fraudulent schemes targeting buyers, brokers, and end-users.
Common warning patterns include psychological pressure, unrealistically high discounts, rigid fixed pricing, and requests for upfront payments presented as logistics fees. Identifying these red flags early can protect capital, operational resources, and trade confidentiality.
The scam: The seller claims a vessel or tank is ready in Rotterdam, Houston, or Fujairah, but requires the buyer to pay for 3 to 7 days of “tank extension” or “storage fees” before granting a Dip Test.
Due-diligence position: Verify storage arrangements directly with the named terminal and reject unverified third-party advance-fee demands.
The scam: Offers use a rigid low fixed price per metric ton regardless of daily market movement, or unusually large fixed discounts.
Due-diligence position: Confirm whether pricing is tied to a recognized benchmark such as Platts or Argus and whether the commercial formula can be independently verified.
The scam: Generic letterheads, free email providers, unverifiable company details, tax IDs or registrations.
Due-diligence position: Verify legal entity records, domain ownership, corporate communications and counterpart authority before relying on offer documents.
The scam: Falsified POP documents, outdated inspection reports or DTA forms linked to pre-payment or non-refundable deposits.
Due-diligence position: Seek independent verification with the terminal operator and inspection company using independently sourced contact details.
The scam: Demands for “passport authorization,” “vessel allocation registration,” or “buyer onboarding” fees before contract execution.
Due-diligence position: Treat unexplained pre-contract cash demands as a major risk indicator and verify all payment instructions through formal counterpart and banking channels.
| Parameter | Verified Transaction Indicator | Red Flag |
|---|---|---|
| Upfront Fees | No unexplained advance payments requested | Requests payment for TSA, passport or registration |
| Pricing Structure | Transparent benchmark-linked formula | Rigid fixed-rate pricing that ignores market movement |
| Inspection | Independent SGS/Intertek verification can be independently confirmed | Payment demanded before terminal access or verification |
| Communication | Official corporate domain emails and independently verified contact lines | Free email addresses or WhatsApp-only communication |
| Documentation | Consistent SPA/ICPO/KYC documentation with verifiable signatories | Generic offers, mismatched signatures or unverifiable documents |
EN590.trade works alongside Chelet Commodity Trading & Marine Solutions Ltd. Şti. to support KYC and AML controls in physical petroleum transactions.
