Increasing supplies from the Middle East could impact naphtha price uptrend

02-Sep-09
Europe delivered some 500,000 tons of naphtha to Asia in the first week of August, that shrivelled. The second week of August saw a surge in Asian naphtha cracks to near 6 month highs on reduction in regular supplies from Europe as flows ended due to refinery run cuts and to meet Western demand for gasoline and petrochemical production, coupled with limited exports from India. Additionally, crackers in South Korea, Japan and Taiwan are running almost full capacity with no scheduled turnarounds. Asia needs monthly imports of 300,000-350,000 tons to cap it's production shortfall. The last week has seen prices easing in anticipation of a supply glut from the Middle East. Will this added supply push cracks below the hundred dollar mark, or could the recovering economies drive petrochemicals to another upcycle akin to what was seen in 2007. November witnessed a slump in China's petrochem demand tanking prices to discounts of US$190/ton. After the announcement of it's stimulus package, robust petrochem demand in China has kept crackers operating at high rates, propping up naphtha cracks to US$115/ton on Aug. 11, that dropped by ten dollars this week. It is reported that Asia's naphtha market would be net short of about 500,000 tons in October. Lower refinery runs in Asia to curb middle distillates production, which also cuts down naphtha. But on the supply side, the restart of Saudi Aramco's 44,000 bpd hydrocracker, after a three-month outage brings to the markets 150,000 tons of A310 grade naphtha and 50,000-100,000 tons of A180 light grade a month. Qatar will export an extra 200,000 tons every a month from October as its new condensate splitter is to start producing light fuels in September. Kuwait, not a regular spot exporter till April, sold a record 300,000 tons in May and in July because of the start-up delay of its aromatics plant. Cargoes are exected to continue as plant start up is now anticipated in October.
  More News  Post Your Comment
{{comment.Name}} made a post.
{{comment.DateTimeStampDisplay}}

{{comment.Comments}}

COMMENTS

0

There are no comments to display. Be the first one to comment!

*

Name Required.

*

Email Id Required.

Email Id Not Valid.

*

Mobile Required.

Email ID and Mobile Number are kept private and will not be shown publicly.
*

Message Required.

Click to Change image  Refresh Captcha