Eleven ICC rules that fix where cost and risk pass from seller to buyer. Oil trades are dominated by the terms below. ★ Incoterms do not govern transfer of title or payment terms — the contract does.
FOB — Free On Board
Risk passes when the seller places the cargo on board at the load port; freight and insurance from that point are the buyer’s, and the buyer nominates the vessel. A sea and inland-waterway term only.
CFR — Cost and Freight
The seller pays freight to the destination port, but risk still passes on loading at the origin port, as in FOB. That split — who pays freight versus who carries risk — is the most commonly misread point in practice.
CIF — Cost, Insurance and Freight
CFR plus cargo insurance. Under Incoterms 2020 the seller need only provide minimum cover (Institute Cargo Clauses (C)), so wider cover must be written into the contract. Risk still passes on loading at the origin port.
DAP — Delivered At Place
The seller carries the cargo to the named destination and bears risk until it is ready for unloading there; import clearance and duties remain the buyer’s. (The former DES and DEQ terms were retired and replaced by DAP and DPU.)
FAS / EXW
FAS delivers alongside the vessel and EXW at the seller’s premises — the lightest seller obligations of the set. Both are uncommon in physical oil and need careful agreement because of how they allocate customs responsibility.
This reference explains published industry norms and standards. It does not replace the terms of an individual contract, nor legal or tax advice — and it carries no prices; the price board does that.