Naphtha crack in Asia rises to a 1-1/2 month low amid easing of tight supplies

22-Feb-17

Asia's naphtha crack hit a 1-1/2 month low of US$91.3/ton as tight supplies were seen easing, as per Reuters. This weighed on prices, with South Korea's YNCC having bought naphtha for H1-April delivery to Yeosu at premiums of about US$7/ton to Japan quotes on a cost-and-freight (C&F) basis. This was down from the US$8.50/ton premium YNCC paid on Feb. 7 for cargoes for H2-March delivery.
"The market is cooling off with more cargoes seen coming from the Middle East," said a Singapore-based source. "What India has cut back will now be easily filled by the Middle East." India's naphtha exports are set to fall this year compared to last year due to growing demand for the fuel from the petrochemical and gasoline sectors.
Sellers such as Reliance Industries could even import heavy naphtha if feedstock is insufficient to meet petrochemicals demand but it will continue exporting paraffinic naphtha. Qatar has restored runs at its newer 14 6,000 bpd condensate splitter following on-off technical issues, traders said.