The price of front-month sour crude oil storage at the Louisiana Offshore Oil Port fell 5 cents/b month on month even as imports to the US Gulf Coast increased over the same period to pre-Harvey levels.
Matrix Markets hosts, on behalf of LOOP, a monthly auction in which the oil terminal sells the right but not the obligation to store a crude blend called LOOP Sour in one of its eight underground caverns. Each capacity allocation contract, or CAC, allows the owner to store 1,000 barrels of LOOP Sour during the contract month.
In the October auction, LOOP sold a total of 4,750, or about 63%, of the CACs it put up for sale. November and December LOOP Sour storage cleared at 15 cents/b for 700 CACs, compared to a four-month high of 20 cents/b for front-month storage volumes during the September auction.
During the October auction, 83% of the front-month November contract was sold compared with 100% of the front-month October contract in the last auction, 89% in September and 100% in August. That compares with a 2017 average to date of 97%.
The 15 cent/b clearing price of storage volumes sold during the October auction corresponds to a flatter WTI curve, which has disincentivized forward-month storage.
The decrease in price comes as crude imports to Morgan City, Louisiana, rose 3.042 million barrels month on month to end September at 10.733 million barrels, according to data from Platts Analytics and the US customs bureau.
In September, the LOOP Sour front- to second-month spread was 18 cents/b when taking into account storage costs and Platts assessments for the blend. That is an improvement over August, when the spread was plus 3 cents/b, Platts data shows.
The ‘In the LOOP’ Americas crude oil wrap runs each Monday in Crude Oil Marketwire, North American Crude and Products Scan and on the Platts Global Alert. You can read the FAQ: USGC LOOP Sour crude here and find the full special report LOOP Sour Crude: A benchmark for the future here.

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