Indicative Oil And Gas Trade Finance Term Sheet
FG Capital Advisors arranges trade finance solutions for oil and gas traders, importers, exporters, distributors, fuel suppliers, energy intermediaries, and commodity platforms with live transactions, credible counterparties, and documentable repayment sources.
The structures covered under this indicative term sheet include documentary letters of credit, back-to-back letters of credit, transferable letters of credit, standby letters of credit, borrowing base facilities, receivables finance, inventory finance, LC discounting, gap financing, margin support, supplier payment finance, and structured transaction finance for oil and gas products.
Eligible products may include crude oil, condensate, LNG, LPG, natural gas liquids, propane, butane, diesel, ultra-low sulfur diesel, gasoil, gasoline, jet fuel, aviation fuel, kerosene, naphtha, fuel oil, bunker fuel, marine gasoil, base oils, lubricants, bitumen, asphalt, petroleum coke, petrochemical feedstocks, and other approved hydrocarbon or refined petroleum products.
Finance providers focus on the buyer, supplier, product, price basis, contract chain, title documents, shipment route, inspection process, sanctions profile, insurance, collateral controls, and repayment source. FG Capital Advisors prepares the transaction package and arranges outreach to suitable banks, commodity finance desks, trade finance funds, private credit providers, LC providers, and credit support partners.
Indicative Facility Summary
| Arranger | FG Capital Advisors. Role limited to commercial structuring, transaction packaging, capital provider outreach, bank introductions, lender coordination, and support through provider review. |
| Borrower / Applicant | Oil and gas traders, fuel distributors, importers, exporters, energy companies, commodity intermediaries, project companies, and operating platforms with verified commercial transactions or recurring trading flows. |
| Facility Types | Documentary letters of credit, back-to-back letters of credit, transferable letters of credit, standby letters of credit, borrowing base facilities, receivables finance, inventory finance, LC discounting, supplier payment finance, gap financing, and margin support. |
| Eligible Products | Crude oil, condensate, LNG, LPG, NGLs, propane, butane, diesel, ultra-low sulfur diesel, gasoil, gasoline, jet fuel, aviation fuel, kerosene, naphtha, fuel oil, bunker fuel, marine gasoil, base oils, lubricants, bitumen, asphalt, petroleum coke, and petrochemical feedstocks. |
| Typical Transaction Profile | Buyer contract, supplier contract, product specification, defined shipment or storage route, clear payment terms, reliable inspection process, acceptable documentation, and identifiable repayment source. |
| Facility Size | Subject to transaction value, product type, buyer quality, supplier quality, collateral base, facility structure, country risk, bank appetite, lender appetite, and available credit support. |
| Tenor | Determined by the trade cycle, shipment period, storage period, receivable tenor, LC terms, borrowing base reporting cycle, repayment event, and lender or bank requirements. |
| Currency | Typically USD or EUR, subject to product market, contract currency, bank capability, borrower jurisdiction, and lender or provider approval. |
| Pricing | Indicative pricing is determined by providers after reviewing the borrower, transaction, bank risk, collateral, product risk, country risk, sanctions profile, tenor, documentation, and repayment source. |
| Status Of Terms | Indicative only. No facility, issuance, funding, credit support, or quote is binding unless approved and documented by the relevant bank, lender, provider, insurer, or credit support counterparty. |
Structures Covered
Oil and gas trade finance can be structured around a single cargo, a buyer-issued LC, supplier payment requirement, receivable, inventory pool, storage position, confirmed offtake, or revolving trading platform. FG Capital Advisors routes each transaction toward the structure that best matches the documents, counterparties, product, and repayment source.
Documentary Letters Of Credit
Arrangement support for importers and traders that need bank-issued payment undertakings in favor of suppliers against compliant shipping and commercial documents.
Back-To-Back Letters Of Credit
Support where a buyer-side LC can anchor a supplier-side LC or supplier payment structure for a live oil or refined products transaction.
Transferable Letters Of Credit
Structuring support for intermediaries that need supplier payment capacity while preserving the commercial flow between end buyer and supplier.
Standby Letters Of Credit
SBLC arrangement support for payment obligations, performance obligations, supplier comfort, credit enhancement, margin support, or beneficiary protection.
Borrowing Base Facilities
Facilities where availability is linked to eligible inventory, receivables, LC proceeds, cash collateral, insured receivables, or other approved collateral.
LC Discounting And Receivables Finance
Support for monetizing eligible LC-backed receivables, confirmed LC flows, accepted documents, invoices, and buyer payment obligations.
Inventory And Storage-Backed Finance
Financing structures linked to controlled product held in tanks, terminals, vessels, bonded storage, monitored warehouses, or approved storage facilities.
Gap Financing And Margin Support
Support where the transaction is live but the trader needs additional cash margin, collateral, risk participation, or short-term funding to complete execution.
Supplier Payment Finance
Structures designed to help secure product from refineries, wholesalers, producers, fuel terminals, or distributors before buyer proceeds are received.
Indicative Structure Comparison
| Structure | Best Fit | Common Collateral Or Repayment Source | Provider Focus |
|---|---|---|---|
| Documentary Letter Of Credit | Importer or buyer needs to secure supplier payment for crude oil, refined products, LPG, LNG, fuel, or petroleum products. | Applicant credit, cash margin, bank line, goods, resale contract, receivable, or LC-backed repayment route. | Applicant credit, product origin, supplier legitimacy, document set, shipment route, sanctions profile, and repayment source. |
| Back-To-Back Letter Of Credit | Trader has a buyer-side LC and needs to secure supplier-side payment without fully funding the purchase in cash. | Buyer-issued LC, supplier contract, margin, title documents, inspection controls, and buyer payment flow. | Issuing bank quality, buyer strength, supplier legitimacy, LC terms, document match, margin, and shipment control. |
| Transferable Letter Of Credit | Intermediary wants to transfer part of the buyer LC to a supplier where the LC is expressly transferable. | Transferable LC proceeds, supplier documents, buyer payment undertaking, and controlled document flow. | Transfer wording, first beneficiary role, second beneficiary documents, margin protection, and bank acceptance. |
| Standby Letter Of Credit | Beneficiary needs payment support, performance support, supplier comfort, credit enhancement, or standby security. | Cash margin, pledged assets, receivables, third-party collateral, risk participation, or balance sheet support. | Obligation supported, beneficiary wording, claim mechanics, applicant credit, collateral, and enforceability. |
| Borrowing Base Facility | Recurring oil and gas trader with eligible inventory, receivables, storage, repeat buyers, and ongoing trade cycles. | Eligible receivables, eligible inventory, insured receivables, cash collateral, LC proceeds, and approved collateral categories. | Borrowing base reporting, advance rates, reserves, collateral monitoring, buyer concentration, inventory controls, and trader track record. |
| LC Discounting | Exporter or beneficiary wants early payment against an eligible LC-backed receivable or confirmed LC flow. | LC proceeds, confirming bank undertaking, accepted documents, buyer obligation, and compliant presentation. | Issuing bank risk, confirming bank risk, document compliance, buyer risk, country risk, and tenor. |
| Gap Financing | Trader has a live transaction but needs additional margin, logistics funding, storage funding, supplier deposit, or collateral support. | Buyer contract, supplier contract, receivable, inventory, LC proceeds, margin contribution, or exit repayment event. | Funding gap size, repayment route, timing, collateral, product control, counterparty credibility, and downside protection. |
Eligible Product Categories
Product eligibility depends on documentation quality, origin, destination, sanctions profile, buyer quality, supplier quality, logistics route, inspection process, insurance, storage controls, and provider appetite. FG Capital Advisors can package transactions across the following product groups.
| Product Category | Examples | Common Financing Route |
|---|---|---|
| Crude And Upstream Liquids | Crude oil, condensate, natural gas liquids, petroleum liquids, and approved upstream products. | LCs, prepayment structures, receivables finance, inventory finance, borrowing base facilities, and structured trade finance. |
| Gas Products | LNG, LPG, propane, butane, and approved gas-linked products. | LC-backed procurement finance, receivables finance, inventory finance, storage-backed finance, and borrowing base facilities. |
| Middle Distillates | Diesel, ultra-low sulfur diesel, gasoil, jet fuel, aviation fuel, kerosene, and marine gasoil. | Supplier payment finance, LCs, back-to-back LCs, receivables finance, LC discounting, and borrowing base facilities. |
| Light Products | Gasoline, naphtha, petrochemical feedstocks, and approved refined light products. | Import finance, receivables finance, storage-backed finance, inventory finance, and LC-backed trade finance. |
| Heavy Products | Fuel oil, bunker fuel, bitumen, asphalt, petroleum coke, and other heavy petroleum products. | Inventory finance, receivables finance, shipping-linked finance, SBLC support, and borrowing base structures. |
| Downstream And Specialty Products | Base oils, lubricants, additives, packaged petroleum products, and approved downstream products. | Distributor finance, receivables finance, purchase order finance, inventory finance, and working capital facilities. |
Indicative Conditions Precedent
Providers will normally require a complete file before issuing indicative terms. The exact requirements vary by facility type, product, jurisdiction, bank policy, collateral, and counterparty risk.
| Transaction Documents | Buyer contract, supplier contract, pro forma invoices, purchase order, sale contract, offtake contract, LC draft, SBLC draft, bank correspondence, and product specification. |
| Product Documents | Certificate of quality, certificate of quantity, certificate of origin, inspection certificate, bill of lading, warehouse receipt, terminal confirmation, tank storage agreement, insurance, and logistics documents where applicable. |
| Counterparty Data | Applicant, borrower, beneficiary, buyer, supplier, refinery, terminal, storage operator, logistics provider, inspection company, and ultimate beneficial ownership details. |
| Financial Information | Financial statements, management accounts, bank statements, trading history, receivables aging, inventory reports, existing debt, facility utilization, and requested funding amount. |
| Collateral Information | Cash margin, pledged assets, receivables, inventory, storage rights, title documents, insured receivables, LC proceeds, SBLC support, third-party collateral, and risk participation options. |
| Compliance Information | KYC documents, sanctions screening data, source of funds, product origin, vessel route, port information, jurisdictional exposure, environmental and regulatory documents where relevant. |
| Risk Controls | Independent inspection, collateral monitoring, account control, title control, insurance, hedging policy, price risk management, storage verification, and payment waterfall. |
Indicative Commercial Terms
| Use Of Proceeds | Supplier payment, product purchase, LC issuance support, SBLC support, collateral margin, shipment costs, storage costs, receivables bridge, inventory finance, borrowing base working capital, or transaction-specific funding gaps. |
| Repayment Source | Buyer payment, LC proceeds, confirmed LC discounting, receivable collection, resale proceeds, inventory monetization, borrowing base collections, refinancing, or other provider-approved repayment source. |
| Security Package | Subject to provider requirements. May include assignment of receivables, inventory security, pledge of accounts, assignment of contracts, control over documents, LC proceeds, insurance assignment, collateral manager reports, and account control arrangements. |
| Advance Rates | Determined by provider after review of product, borrower, receivable, inventory, collateral controls, bank risk, buyer risk, country risk, price volatility, and documentation quality. |
| Fees And Costs | Arrangement fees, lender fees, bank fees, issuance fees, confirmation fees, discounting costs, legal fees, inspection fees, collateral monitoring fees, insurance costs, and third-party provider fees may apply. |
| Governing Documentation | Facility agreement, LC application, SBLC application, borrowing base agreement, receivables purchase agreement, assignment documents, security documents, account control documents, and provider-specific documentation. |
| Exclusions | No guarantee of funding, issuance, discounting, bank approval, beneficiary acceptance, pricing, margin level, delivery timing, or closing. No support for unverifiable broker chains, fake allocations, sanctioned trades, or transactions lacking commercial substance. |
Submit your transaction if your company needs a documentary letter of credit, back-to-back letter of credit, transferable letter of credit, standby letter of credit, borrowing base facility, LC discounting, receivables finance, inventory finance, gap financing, or margin support for a real oil and gas trade.
Request A QuoteArrangement Process
Transaction Intake
Client submits the transaction, product, buyer, supplier, amount, funding requirement, documents, timing, and target structure.
Bankability Review
FG Capital Advisors reviews the file for product eligibility, counterparty risk, collateral, repayment source, document quality, and provider fit.
Provider Package
A lender-facing or bank-facing transaction package is prepared with the commercial structure, facility request, collateral, and risk mitigants.
Provider Outreach
The transaction is presented to suitable banks, trade finance funds, commodity finance desks, private credit providers, LC providers, and credit support partners.
Term Sheet Review
Indicative terms, pricing, collateral requirements, facility structure, conditions precedent, and provider comments are reviewed with the client.
Execution Support
FG Capital Advisors supports the process through provider review, diligence coordination, documentation requests, and closing workflow.
Frequently Asked Questions
Does FG Capital Advisors provide oil and gas trade finance directly?
No. FG Capital Advisors acts as an arranger and transaction packager. We review the file, prepare the provider-facing package, and approach suitable banks, lenders, trade finance providers, commodity finance desks, LC providers, private credit funds, and credit support partners.
Can a buyer-issued LC support oil and gas trade finance?
Yes. A buyer-issued documentary letter of credit may support back-to-back LC structures, supplier payment finance, LC discounting, confirmed LC discounting, receivables finance, or LC-backed procurement finance, subject to bank and provider approval.
Can you arrange borrowing base facilities for oil and gas traders?
Yes. Borrowing base facilities may be arranged for recurring traders with eligible inventory, receivables, insured receivables, LC proceeds, storage documents, buyer concentration data, collateral monitoring, and recurring reporting capacity.
What is gap financing in oil and gas trade finance?
Gap financing refers to short-term or transaction-specific support where the trader has a live trade but needs additional cash margin, collateral, logistics funding, supplier deposit funding, storage funding, or bridge capital to complete execution.
Which oil and gas products can be considered?
Products may include crude oil, condensate, LNG, LPG, propane, butane, diesel, ultra-low sulfur diesel, gasoil, gasoline, jet fuel, aviation fuel, kerosene, naphtha, fuel oil, bunker fuel, marine gasoil, base oils, lubricants, bitumen, asphalt, petroleum coke, and approved petrochemical feedstocks.
What documents are needed to request a quote?
Typical documents include buyer and supplier contracts, pro forma invoices, product specification, payment terms, draft LC or SBLC wording, shipment documents, storage documents, inspection terms, insurance, corporate KYC, financial information, collateral details, and the requested funding amount.
Can transferable LCs be used for petroleum trades?
Yes, where the original LC is expressly transferable and the issuing or transferring bank accepts the structure. Transferable LC use depends on wording, supplier acceptance, buyer requirements, document flow, and bank policy.
What makes an oil and gas trade financeable?
A financeable file usually includes credible counterparties, a real contract chain, clear product specification, acceptable origin and destination, clean sanctions profile, controlled documents, reliable inspection, insurance, realistic margin, and a defined repayment source.
