Naphtha crack in Asia rises to anear 2 week high amid expected tighter supplies

26-May-14

The Asian naphtha crack rose for a fourth straight session on Friday, nearing a two-week high of US$148.8/ton as supplies were expected to be tighter due to possible lower volumes of European barrels streaming to the East in July, as per Reuters. Europe is finding it more lucrative to sell gasoline to West Africa rather than export to Asia, which is structurally short of naphtha, traders said. Some traders were however not convinced this would be enough to support the recent bull run over the longer term, given that India is likely to increase its June exports versus May. The absence of naphtha trades in the Singapore cash market for two straight weeks since May 9 could also indicate a lack of confidence among traders as to what positions to take in a market which lacked a clear, firm direction, traders said.