Firstly, follow the base game drinking rules, found here:

Additional rules:

• Any base game drinking rules referring to Resources now also include commodities

• Whenever the barbarian ship moves closer to the island of Catan, every 1 drinks 1 sip
• Whenever one of your cities are pillaged by the barbarians, take 1 shot
• Whenever you gain a Defender of Catan card, give away 1 shot
• Whenever you build the Aqueduct, Fortress and/or Trading House city improvement, give away 3 sips
• Whenever a player builds a Metropolis, all other players take a shot
• Whenever you lose control of the Merchant, take 2 sips

Why it’s a good drinking game:

With a few simple, but impactful additions to the base game, Cities and Knights gives you even more ways to dish out sips and shots to your opponents.