Naphtha prices in Asia started the week at a two-session low, while cracks reversed gains and hit a 10-month low for the second time in three sessions; as short-term outlook stayed bleak due to weaker demand, as per Reuters. Weak fundamentals affected Egyptian General Petroleum Corp's (EGPC) sales, who failed to award all 17 parcels offered from Suez for July-Decemer loading. Suez cargoes typically are to cater to demand in the East, while Alexandria parcels are meant for the West.
EGPC sold a total of 12 cargoes, at 35,000 tons each, to Total, Vitol and Noble at premiums below US$2-6/ton to Middle East quotes on a free-on-board (FOB) basis. These were lower compared with a total of 525,000 tons sold to Vitol, Total and ConocoPhillips for H1-2011 loading from Suez at premiums of US$5-13/ton. However, all of EGPC’s 17 cargoes for H2-2011 loading from Alexandria were sold. In anticipation of a further fall in the Asian market, traders are not likely to be able move parcels to Europe as there is not much support from the West despite this being summer driving season in USA. The price for open spec naphtha, front-month H2- July fell by ten dollars to US$967/ton.