Taiwan’s Formosa Petrochemical Corp purchased naphtha at a more than 1-year high premium this week, as buyers mopped up excess cargoes after attacks on Saudi Arabia’s oil facilities on Sept. 14 raised supply worries, industry sources said on Thursday. Asia’s top naphtha buyer paid a premium of around US$12/ton to its own price formula on a cost-and-freight (C&F) basis, making it the highest amount it has paid since May 2018, Reuters data showed. The premium for about 100,000 tons of open-specification naphtha scheduled for first-half November delivery to Mailiao was in sharp contrast to a discount of about $2 Formosa paid on Sept. 12.
Aramco has been on a buying spree for oil products since the attacks and has turned to Europe for naphtha and gasoline. Last week it snapped up spot cargoes offered by India’s Hindustan Petroleum Corp Ltd at a premium above $20 a tonne on an FOB basis.
Saudi Arabia is restoring its lost oil production capacity faster than expected but the kingdom’s refinery run rates were unclear.