The decision by the Maritime and Coastguard Agency (MCA) means millions of tonnes of crude oil could be pumped from Russian ships to supertankers for onward shipment.
Last night campaigners, MEPs and local authorities pledged to fight the plans, either by taking legal action or by launching a major European Union investigation to block the transfers.
Those who have campaigned against the scheme include Fife, Edinburgh and East Lothian councils as well as the RSPB, the Scottish Green Party and Friends of the Earth.
RSPB Scotland claims that the firth's habitat - including three designated Special Protection Areas for seabirds - is important all year round for a wide variety of birds and that these species will be put at increased risk under the proposals.
Opponents have also described the consultation as a "sham" as it did not ask the public on whether the transfers should get the go-ahead, but rather on the contingency plans that should be put in place in case of an oil spill.
The Sunderland-based company Melbourne Marine Services (MMS) is proposing to pump about 7.8 million tonnes of Russian crude every year between tankers lying four miles off the Fife coast. Forth Ports, the harbour authority, is in favour of the idea to transfer crude at rates of up to 3,000 tonnes per hour. It stands to earn more than 6 million a year from the transfers.
Such measures already take place at Scapa Flow in Orkney, Sullom Voe in Shetland, and at Nigg in the Cromarty Firth.
A spokeswoman for the Scottish Executive said the MCA made it clear that approval of the plans was subject to several amendments and that any final decision would not discharge Forth Ports from its statutory duty in relation to the European union's habitat directive.
But Mark Ruskell, a Green speaker on the environment and MSP for Mid- Scotland and Fife, said the amendments, which go into technical details on how to respond to oil spills, paid scant regard to human health and marine mammals and birds.
Alyn Smith, a Scottish National Party MEP, said that if Forth Ports sanctions the transfers, it would be in breach of the European habitats directive, which makes specific requirements for the protection of the environment.
Speaking from Brussels, Mr Smith said: "This decision is condemning the Forth to a potential environmental disaster." He added that the EU's commissioner for the environment was looking at the case.
Forth Ports said it had a statutory duty to ensure the safety of all operations in the area. A spokesman for the MCA said: "The MCA's decision follows a public consultation that was launched on 16 February, 2006 and followed an application by Forth Ports plc for a revised oil spill contingency plan."