Naphtha in Asia at 3-1/2 month high of US$948, margins slip to a two-session low

14-Aug-12

At US$948, naphtha price in Asia has peaked to a 3-1/2 month high on Monday, while margins have dipped to a two-session low of US$96.30/ton premium as buyers have put on hold spot purchases in view of high Brent crude and weak economic data, as per Reuters. Data from Japan showed that its economy grew 0.3% in April-June from Q1-2012. This follows discouraging Chinese trade figures last week. These weak numbers along with persistent economic uncertainty has divided traders about the direction of the naphtha market. This was evident in the term talks having reached a deadlock between South Korean buyer YNCC and its sellers for naphtha meant for September 2012 to August 2013 delivery. Saudi Aramco has sold about four long-range vessels of naphtha totalling up to 220,000 tons for August loading from different ports at premiums in the low US$20s/ton to Middle East quotes on a free-on-board (FOB). Of the four cargoes, two were of A180 grade, likely from Yanbu. Another cargo consisted of naphtha from Rabigh and Jeddah, and the last cargo contained naphtha from Jubail.