Naphtha crack in Asia edges at 2-week high as buyers look to fill up stocks

10-Jun-15

Asia's naphtha crack edged up to reach a two-week high of US$92.40/ton on Thursday, supported by buyers looking to fill up stocks for H2-July, as per Reuters. South Korea's Hanwha, formerly Samsung Total, has bought a naphtha cargo for H2-July delivery to Daesan at a low single-digit premium to Japan quotes on a cost-and-freight (C&F) basis, traders said. They added that the premium should be higher than what Lotte Chemical had paid for H1-July naphtha on May 29 at about US$1.75/ton in view of the stronger sentiment this week. Malaysia-based Titan was also seeking H2-July naphtha through a tender due to be awarded on June 5. In term talks, Kuwait Petroleum Corp (KPC) has pegged offers for naphtha lifting in a one-year contract starting August 2015 at US$15/ton above Middle East quotes on a free-on-board (FOB) basis, traders said on Thursday, down from an initial US$18. No buyers, which include customers from Japan and South Korea, have accepted the offers as of 1000 GMT, traders said in Reuters. "But I think they are close to sealing the deal and it could be done as soon as later today in London (where the talks are held)," said a trader. The buy-sell gap between KPC and its buyers is less than US$2.