Naphtha margins fall in Asia on muted demand

24-Jul-12

Naphtha prices in Asia fell to a five-session low of US$856/ton on Monday, with margins down to a week low of US$83/ton premium on muted buying interest from petrochemical makers, as per Reuters. Demand has dipped as South Korean buyers appear to be holding back after a week of brisk purchases amid falling crude oil. Demand is expected to be temporarily immobilized as buyers could adopt a wait and watch stance in anticipation of a further price fall. Some traders are also watching European exports to Asia. June saw total refinery output in Europe rise by 3.1% vs May, with naphtha showing the biggest month-on-month production gains at 3.4%.