Asian markets face decline in naphtha exports from India, rising South Korean demand

13-Jan-09

The Asian market, on one hand, is currently faced with rising demand as several majors in South Korea have increased run rates at their crackers since last month, to meet rising demand from China. On the other hand supplies have been affected as naphtha exports from India have dipped because of stronger domestic demand. Oil and Natural Gas Corp has no plans to export naphtha in the month of January because of pressures of robust domestic demand. The oil major mulls shipping one cargo in February. Indian Oil Corp (IOC) has sold to South Korea's leading oil refiner SK Energy, January naphtha cargo from at a double-digit premium of US$20/ton to Middle East quotes on a free-on-board (FOB) basis for January 28-30 lifting from Dahej. Earlier, IOC fetched a US$18/ton premium above Middle East quotes, FOB, for a 30000 ton parcel sold to Sempra for January 25-26 lifting from Kandla. As the South Korean naphtha makers target to take advantage from the strong Chinese demand, spot premiums have been boosted.