SUBSCRIBER NOTE: Platts to launch USGC LOOP Sour crude assessments March 27

S&P Global Platts will launch on March 27, 2017, daily price assessments of LOOP Sour crude traded in cavern at the Louisiana Offshore Oil Port terminal near Galliano, Louisiana. These assessments will be published as an outright price in US dollars per barrel for one, two and three calendar months forward.

LOOP Sour is typically traded in cavern at LOOP via title transfer, although its trading schedule follows that of other pipeline-deliverable US Gulf Coast crudes. The front-month LOOP Sour price reflects barrels trading one calendar month forward, with trading shifting to the next month on the first business day after the 25th day of the calendar month. The minimum volume reflected for the LOOP Sour assessments is 25,000 barrels, in line with other USGC pipeline assessments.

LOOP SOUR BLEND: LOOP Sour is medium sour crude blend that is comprised of two domestic US crudes -- Mars and Poseidon -- and three Middle Eastern crude import streams -- Arab Medium, Kuwait Export Crude and Basrah Light. It is stored in one of eight man-made underground caverns at the LOOP facility. As such, the quality of LOOP Sour crude changes monthly depending on the amount of the five crudes delivered into the blend. Since May 2015, LOOP Sour has had an average API gravity of 30.3 and sulfur content 2.29%, according to monthly quality reports published by LOOP LLC.

While LOOP Sour is typically traded in cavern, Platts understands that LOOP Sour buyers are not required to lease storage within the LOOP facility. There is a 15-day grace period in which the buyer may store the crude in cavern at no cost before scheduling it for delivery. However, Platts understands that LOOP LLC requires sellers of LOOP Sour to have a capacity allocation agreement, which can be secured via a monthly storage auction or the secondary storage market.

RATIONALE FOR ASSESSMENT: The Gulf Coast is a key crude production and import hub in the US. While the bulk of US crude oil production is light sweet crude, the majority of US refining capacity is geared toward processing heavy/medium sour crude. The US Gulf Coast, in particular, remains a key consuming region for heavy/medium sour crude, accounting for more than half of US refining capacity. The LOOP facility is the single largest entry point for waterborne crude oil entering the US, and has direct pipeline and indirect pipeline connections to refineries in Texas, Louisiana and the Midwest.

The Platts LOOP Sour assessment provides a benchmark for sour crude pricing on the US Gulf Coast, as it encompasses both the value of medium sour crude produced in the Gulf of Mexico, as well as medium sour crude imported from the Middle East into one of the world's key refining centers.

MARKET ON CLOSE PROCESS: Platts will publish bids, offers and trades of LOOP Sour crude through the Platts Market on Close assessment process, on both an outright and differential basis. LOOP Sour spot contracts typically trade as a differential to cash WTI or front-month Mars crude. Platts' US crude assessments reflect value at 2:30 pm Eastern Time.

ASSESSMENT PUBLICATION: The LOOP Sour assessments will be published on the Platts Global Alert real-time service, in the Platts Crude Oil Marketwire, Platts Oilgram Price Report, and Platts North American Crude and Products Scan, as well as in the price database under the following codes:

Assessment Market Data Code LOOP Sour Crude Mo01 AALSM01 LOOP Sour Crude Mo02 AALSM02 LOOP Sour Crude Mo03 AALSM03

Please send comments and feedback to americas_crude@spglobal.com and pricegroup@spglobal.com.

For written comments, please provide a clear indication if comments are not intended for publication by Platts for public viewing.

Platts will consider all comments received and will make comments not marked as confidential available upon request.