VS, VSOP and XO refer to the age and quality of the cognac. Each corresponds to how long the brandy has been aged in oak barrels. In 1983, following a request by the BNIC (Bureau National Interprofessionnel du Cognac)*, the French government drafted regulations governing the terms used to describe a cognac"s quality. These designations, which may be included on the label, refer to the age of the youngest eau-de-vie used in making the cognac.

VS stands for "Very Special": only eaux-de-vie at least two years old can be used to make a VS cognac. Other denominators and expressions are permitted, such as "3 stars" or "luxury", and as such are included in the VS cognac category.

VSOP stands for "Very Superior Old Pale": VSOP cognacs are created from eaux-de-vie aged for at least four years. The VSOP category includes designations such as "Old" or "Reserve". 

XO stands for "Extra Old": XO cognacs are made only from eaux-de-vie at least six years old. Cognacs such as "Napoleon" or "Old Reserve" are equivalent to XO cognac. 

Incidentally, the reason these 
abbreviations are in English is because cognac has been exported for many years and the first importers spoke English.

*Public-service organisation responsible for looking after the interests of cognac and all related activities.