Rare Brazilian Polvo crude cargo arrives in Louisiana: In the LOOP

A rare cargo of Brazilian Polvo crude has made its way to the Louisiana Offshore Oil Port, according to data from US Customs and S&P Global Platts Analytics.

On April 23, LOOP imported one cargo of Polvo crude, with a total volume of 270,408 barrels. The Polvo barrels, shipped by Petrobras and consignee Trafigura, have an API gravity of 22.6 degrees. The heavy sour grade is produced in the Polvo Field, located in the Campos Basin offshore southeastern Brazil.

Although Polvo barrels are rarely imported into LOOP, other Brazilian heavy sour grades such as Frade, Roncador, Jubarte and Ostra frequently make their way to the US Gulf Coast. In January, LOOP imported a 620,000-barrel cargo of 19.7 degree API Frade crude shipped by Chevron Brazil and Trafigura.

In December 2017, two cargoes of Roncador made their way to Morgan City, Louisiana, the delivery point for LOOP. The cargoes had a combined volume of 932,445 barrels and were both shipped by Petrobras and consignee Marathon Petroleum Co.

Two other cargoes of Polvo crude have made their way to the USGC in general so far in 2018. On April 20, a 188,000-barrel cargo of heavy sour grade was imported in Gramercy, Louisiana, with the shipper unknown. Earlier in the year on February 5, a 428,047-barrel cargo of Polvo was also imported in Gramercy, with Petro Rio as the shipper on record.

A wider Brent/WTI swap spread since the start of the year has served to disincentivize Brent-based barrels to the USGC. Brent's premium over WTI has increased 31 cents/b since January 2 to end at $6.2/b Friday. As Brent's premium increases, Brent-based grades like those produced in Brazil become less competitive with comparable WTI-based sour grades.

Despite the narrower Brent/WTI spread, decreasing imports of heavy sour Venezuelan crude to the USGC have opened up a window of opportunity for competing heavy sour grades, such as those produced in Brazil, Colombia and Ecuador.

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. Also be sure to download our LOOP app(opens in a new tab) by searching for 'Platts LOOP' in your app store.