Essar sells late Oct naphtha to Itochu at premiums that reflect a firm market

08-Oct-12

India's Essar Oil has sold 35,000 tons of naphtha to Itochu for Oct. 26-30 loading from Vadinar at about US$31-32/ton above Middle East quotes on a free-on-board (FOB) basis, with traders saying the premiums reflect a firm market, as per Reuters. The average premium for Indian cargoes being shipped last month was about US$20/ton. This can be attributed to reduced supplies from Europe. Strong gasoline demand in the West has affected the overall supply situation in Asia. Asia will receive about 400,000-450,000 tons of European naphtha in October versus 800,000 tons in September. Asia could need a few more cargoes from the West to offset the volatility in India's exports which have been unpredictable due to refinery maintenance and domestic gasoline demand.