Naphtha starts the week in Asia near one-week low

Asia's naphtha price was near a one-week low on Monday, while times preads fell to their lowest in 7-½ months as a prolonged cracker shutdown at Taiwan’s Formosa hurt sellers, as per Reuters. The lost demand also sent cracks to their lowest in about 2-½ months and reduced Asian prices to levels lower than in Northwest Europe. This helps open the opportunity for traders to move Gulf and Mediterranean cargoes to the West, provided they can find buyers. June/July swaps timespreads were at a discount of US$2/ton, down from a premium of 25 cents, making this the first contango since Feb. 22. Formosa operates a 2.93 mln tpa cracking complex, of which the 700,000 tpa No. 1 cracker has been shut since around May 13 after a fire at a pipeline. A minimum of 250,000 tons of demand is estimated to have been wiped out because of the shutdown. The price for front-month H1 July fell by 16 dollars to US$966/ton, lowest since May 25. Cracks dropped by over nine dollars to US$107.25/ton, lowest since March 17.