Naphtha crack falls amid lack of buying interest from petrochemical makers

03-Apr-14

Naphtha crack in Asia for front-month H2-May slipped to US$134.25/ton on Wednesday amid lack of buying interest from petrochemical makers, as per Reuters. Most buyers are covered for H1-May, but will need to source for H2-May delivery cargoes. Buyers prefer to wait in the sidelines to see if the market will cool off as no tightness is expected in H2-May supplies. European cargoes arriving in May in Asia are expected to fall below 2013's monthly average of 1.1 mln tons and amid heavy refinery maintenance in Asia, boosting premiums for naphtha scheduled for H1-May delivery to levels above US$10/ton to Japan quotes on a cost-and-freight basis in South Korea and Taiwan. By H2-April, Reliance Industries will likely have completed maintenance at a 330,000 bpd crude unit at Jamnagar and may have more naphtha to export for May over April. Reliance has so far sold 55,000 tons of naphtha for April loading versus a monthly average of 103,000 tons for January to March and about 220,000 tons for December.