Heavy overnight rain made the opening Vignoble de Cleebourg a tricky test, with standing water and mud on several critical corners requiring the drivers to adopt a more cautious approach.
Running fourth on the road, Loeb slid off while tackling a long right-hander during an early section of the stage and subsequently rolled his Citroen DS3 WRC into a ditch.
The nine-time champion and co-driver Daniel Elena came away unscathed, but the accident brought an end to their last planned rally and dashed any hopes for a final hometown success.
Ogier, meanwhile, put in a stunning time through the same stage and finished 14.5 seconds ahead of Volkswagen team-mate and overnight leader Jari-Matti Latvala to take control of the rally.
The newly-crowned champion then went on to post the quickest times through the streets of Bischwiller and the last of the morning's stages in Hagueanu extend his overall lead to 13.7s.
Loeb's misfortune has promoted erstwhile rally leader Thierry Neuville up to fourth overall. The Belgian showed a good turn of speed during the morning to keep Ogier honest on stage pace.