Asia's naphtha price and cracks were at their highest in about a week on Monday, expected to cool down soon as traders remain unconvinced that supplies are as tight as they seem, as per Reuters. Cracks have been climbing since March 16, with nearly an 11% surge on Monday, but traders said bulls were focusing too much on supply disruptions in Japan after the earthquake.
Naphtha is estimated to be weaker, and Japanese refineries are expected to run at maximum rates due to shortages of petroleum products. In view of the power shortages, Japan could give priority to refineries rather than crackers. Font-month H1-May naphtha inched up to US$986/ton.
Gasoline cracks are at week highs, supported by Japan's and Southeast Asian demand. However, current levels at less than US$4.50 a barrel are below January's average at nearly US$7.60 a barrel and February's average at around US$5 a barrel.