Arbitrage window for heavy naphtha reopens from US Gulf to Asia

08-Apr-13

Fixtures for shipments of over 190,000 mt of heavy naphtha bound for Asia from the US Gulf Coast show that the arbitrage window has reopened to meet firm demand from Asia, as per Platts. This is the second time in a year that the previously rare arbitrage window has opened, spurred this week by ample US supply amid a weaker gasoline market. The US Gulf Coast-Asia arbitrage last opened in October, when shipments were fixed for about 265,000 mt of naphtha.Interest in moving naphtha from the US Gulf Coast to Asia has been brewing all week. Sources said two LR1 tankers and two MR tankers were booked, with 191,000 mt of heavy naphtha slated to load over early April. A source close to the deal confirmed that Glencore is moving vessels from USGC to Asia, adding that the arbitrage opportunity had been available for a week.