Naphtha crack in Asia spikes to 3 week high

26-Dec-16

Spiking by over 10%, Asia's naphtha crack is at a three-week high of US$73.7/ton at the end of the previous week, amid strong gasoline demand and lower crude oil prices, as per traders in Reuters. Fundamentally, naphtha supplies were ample and sellers continued to release cargoes at discounted prices.

South Korea's LG Chem paid discounts of about US$1.50- $2/ton to Japan quotes on a cost-and-freight (C&F) basis for naphtha delivering to Daesan and Yeosu in H1-February. This was within the levels paid by YNCC and Lotte Chemical this week for first-half February cargoes. "The stronger naphtha crack today could be due to gasoline and crude," said a Singapore-based trader. Demand for gasoline within and outside Asia was strong, causing supply to tighten, traders said.