A Swiss commodity trading company has secured a structured buy-and-sell agreement for Jet Fuel and is seeking a financial partner to facilitate trade execution. The partner will be required to issue a Standby Letter of Credit (SBLC) to enable transactions and, in return, will receive a fixed profit of $1.15 per barrel traded. The Swiss company will handle all operational aspects, ensuring a seamless process.
Trade Structure & Financial Requirements
Trade Volumes & Timeline
- Month 1: Trial shipment of 1 million barrels
- Month 2: Increased volume of 2 million barrels
- Month 3 Onward: 6 million barrels per month (delivered as 2 million barrels every 10 days)
SBLC Requirements
- Month 1: $82 million
- Month 2 & Beyond: $164 million
The SBLC is a financial guarantee that secures the purchase and delivery of the jet fuel. The Swiss company currently lacks sufficient collateral to issue this on its own bank account and requires a financial partner to provide the SBLC.
Investment Opportunity & Partner’s Role
- The partner provides the SBLC to enable the transaction.
- The Swiss company handles all trade operations, including logistics and execution.
- The financial partner receives $1.15 per barrel traded, which covers their SBLC cost and secures their profit.
- A joint bank account under the Swiss company will be used to process transactions:
- The buyer deposits funds into this account.
- The seller receives payments from this account.
- This ensures transparent fund flow and security for all parties.
Revenue Potential for the Partner
- Month 1: 1 million barrels → $1.15M revenue
- Month 2: 2 million barrels → $2.3M revenue
- Month 3 & Beyond: 6 million barrels per month → $6.9M per month
With sustained trade, the financial partner can expect consistent and growing returns from this structured agreement.
Profitability Scenarios & SBLC Cost Analysis
SBLC Cost Norms
- Minimum Cost: 1% per annum
- Average Cost: 1.5% per annum
- High Cost: 2% – 3% per annum
Monthly Profitability Breakdown Based on SBLC Cost
| SBLC Cost (%) | Monthly SBLC Cost (USD) | Net Profit (USD) |
|---|---|---|
| 1.0% | $136,667 | $6.9M |
| 1.5% | $205,000 | $6.9M |
| 2.0% | $273,333 | $6.9M |
| 3.0% | $410,000 | $6.9M |
- Even at higher SBLC costs (3%), the deal remains highly profitable.
- The SBLC cost is an ongoing requirement, as the trade is continuous.
- The profitability margin per barrel ($1.15) allows for consistent returns despite varying SBLC costs.
Risk Mitigation & Security Measures
- Transparent Fund Flow – The use of a joint bank account ensures that funds are managed securely, reducing counterparty risk.
- Fixed Profit Structure – The financial partner earns a guaranteed margin per barrel, independent of market fluctuations.
- Managed Operations – The Swiss company is responsible for all trade logistics, eliminating operational burdens for the partner.
- Strategic Long-Term Potential – Given the scalability of the deal, the partnership can extend beyond the initial volumes, increasing profitabili
Discuss This Opportunity
If this jet fuel trade partnership matches your strategy, use the assisted route below to continue the conversation.