Naphtha cracks in Asia rebound

Naphtha prices in Asia steadied on Wednesday, while cracks rebounded from a near two-week low to reach a two-session high on demand from Taiwan, as per Reuters. On Tuesday, naphtha crack spread in Asia dipped for the first time in three days, falling to a premium of US$131.9/ton from US$138.1 yesterday, according to Bloomberg. This crack spread, a measure of refining profit, narrowed for the first time since March 16. Vitol Group has concluded a deal for 25,000 tons of open-spec naphtha for delivery in the H2-May to Itochu Corp. at US$1079/ton. News that Formosa is seeking volumes for H1-May arrival, a week after it bought 50,000-75,000 tons for H2-April arrival has spread optimism in the market. As per Reuters, spot demand could stay firm because buyers are not getting the maximum quantities from their suppliers. Naphtha sellers usually have the option to supply buyers 10% less than the contracted volumes and this affects customers' inventories.
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