Concern over mounting supplies ahead have pulled down naphtha prices in Asia to 6 week lows, while cracks are at around 4 week lows, despite demand from Japan.
Idemitsu has bought a parcel for H1-March arrival at premium of US$11/ton to Japan spot quotes, C&F. Two days later, Mitsui Chemicals has purchased 25,000 tons of naphtha for H1-March arrival at a premium of around US$7.50/ton to Japan spot quotes on C&F basis.
The strength in demand has been impacted and is lesser than before, particularly from South Korea. Few buyers who had secured parcels on a private basis have negatively impacted sellers by creating an impression that demand is weaker than it really was. But, traders hope that this softer demand could keep fresh Western barrels from anchoring on Asian shores, thus preventing a further slide.
In Kuwait, KPC has restarted operations at its new aromatics plant after an outage compelled a shutdown on Jan. 14. Production run rates are currently pegged at 70% due to limited full-range naphtha.