expr:class='"loading" + data:blog.mobileClass'>

Ship-to-Ship (STS) & Tank-to-Tank (TTT) Transfers in Oil Trading: Legit Uses vs Red Flag


Introduction

In oil & gas shipping, delivery does not always occur directly from refinery or terminal to the final destination. In certain operational and logistical scenarios, Ship-to-Ship (STS) and Tank-to-Tank (TTT) transfers are used to reposition, blend, or redistribute petroleum cargo.

However, STS and TTT are also frequently misunderstood and misused, especially by speculative parties. This article explains what STS and TTT really are, their legitimate uses, and the red flags buyers must watch for.
 
What Is Ship-to-Ship (STS) Transfer?

a) Ship-to-Ship (STS) transfer refers to the movement of petroleum cargo from one vessel to another, typically conducted:
  • At designated anchorage areas
  • Within port limits
  • Under strict maritime and safety regulations

b) STS is commonly used for:
  • Cargo consolidation
  • Vessel size optimization
  • Repositioning cargo closer to final destination
STS operations require port authority approval, certified equipment, and experienced marine operators.

What Is Tank-to-Tank (TTT) Transfer?

a) Tank-to-Tank (TTT) transfer involves moving petroleum products from one storage tank to another, usually within:
  • The same terminal
  • Different terminals
  • Storage facilities under the same operator

b) TTT is often used for:
  • Product segregation
  • Blending
  • Inventory management
TTT must be conducted under terminal authorization and documented properly.

How Legitimate STS & TTT Operations Work

A compliant STS or TTT transaction includes:
  • Valid Sales & Purchase Agreement (SPA)
  • Issued LC (MT700) or SBLC/BG (MT760)
  • Approved operational plan
  • Port authority or terminal permission
  • Independent inspection (e.g. SGS)
  • Full marine and terminal documentation
Without these elements, STS or TTT should not proceed.

Key Documents in STS & TTT Transactions

Legitimate STS/TTT operations are supported by:
  • SPA
  • Authority to Board (ATB)
  • Charter Party Agreement (CPA)
  • Notice of Readiness (NOR)
  • SGS Certificate of Quality & Quantity
  • Transfer logs and terminal records
These documents ensure traceability, safety, and banking compliance.

Legitimate Uses of STS & TTT

✔ Cargo repositioning for delivery efficiency
✔ Blending to meet specification requirements
✔ Storage optimization
✔ Port congestion management

When executed properly, STS and TTT are normal industry practices.

Red Flags Buyers Must Watch For

🚩 Requests for STS/TTT before LC or SBLC issuance
🚩 Claims of “product already on vessel” without documents
🚩 POP demanded prior to banking compliance
🚩 No port authority or terminal approval
🚩 Refusal to allow independent inspection

These are strong indicators of non-compliant or speculative offers.

STS / TTT vs TTV: Key Differences
  • TTV: Tank → Vessel (terminal-based, structured)
  • TTT: Tank → Tank (storage management)
  • STS: Vessel → Vessel (marine operation)
Each method serves a different purpose and requires specific approvals and documentation.

Banking & Compliance Perspective

Banks recognize STS and TTT only when:
  • Financial instruments are active
  • Documents are verifiable
  • Operations follow approved procedures
Any STS/TTT request outside this framework is not bankable.

Conclusion

STS and TTT are legitimate tools in oil trading when used correctly. However, they are also the most misrepresented methods by non-genuine parties.

Understanding the difference between legitimate operational use and red flags allows buyers to protect capital, comply with banking rules, and avoid failed transactions.

👉 In the next article, we will explain Authority to Board (ATB), Charter Party Agreement (CPA), and Notice of Readiness (NOR) in oil shipping.