The European naphtha cargo range fell by US$29/ton (€21/ton) due to lower Brent crude prices, as per ICIS. On Thursday, at 10.00 GMT, the naphtha range was assessed at US$928-936/ton CIF (cost, insurance & freight) NWE (northwest Europe), with August Brent crude at US$113.55/bbl and the July crack spread at minus US$8.75/bbl.
The naphtha market has been oversupplied in recent weeks and a fall in prices may lead to expectations of increased demand. However, today’s price drop has so far had little effect.
Volatile crude oil prices are not having a huge effect on demand in Europe because of the euro-dollar exchange rate. With downstream products priced in euros, the current exchange rate means that the impact of the crude price drop on petrochemical values is not sufficient to instigate demand for naphtha. Furthermore, buyers are said to be waiting for July contract prices to be settled for products such as ethylene (C2) and propylene (C3) before purchasing further quantities of naphtha.
17-Jun-11 
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