Naphtha in Asia peaks to six-month high

19-Sep-13

The Asian naphtha price rose for the second consecutive session to reach a five-session high of US$963.50/ton on Monday, while margin spiked by 13.6% to hit a six-month high of US$129.80/ton, supported by demand, as per Reuters. Taiwan's Formosa Petrochemical Corp is out seeking naphtha for a six-month contract starting December in a tender due to be awarded on September 18. "Traders may be pushing up the prices in Asia to make it attractive for European cargoes to sail into the east," said a Singapore-based trader. Some traders were concerned that reduced shipments for arrival in November in Asia from the west due to refinery maintenance in Europe and recent weak Asian prices will lead to an acute shortage in the east as seen in Q1-2013. Typically, demand for November and December naphtha cargoes is expected to be healthy as alternative feedstock liquefied petroleum gas (LPG) becomes more costly due to winter demand.