S-Oil fetches premiums higher than on June naphtha cargo

24-Jul-12

South Korea's S-Oil Corp and Thailand's IRPC Pcl have sold a total of about 71,000 tons of August naphtha to Itochu Corp. S-Oil has fetched premiums that were at least 11 times higher than a June cargo, as per Reuters. S-Oil sold 33,000 tons of light naphtha for Aug. 18-22 loading from Onsan to Itochu at premiums of US$12-13.50/ton to Japan spot quotes on a free-on-board (FOB) basis. It had fetched premiums of less than US$1/ton for a late June cargo also sold to Itochu. IRPC sold about 38,000 tonnes of heavy naphtha for H2-August to the Japanese trader, but exact premium levels were not known. Traders estimated that Itochu had likely paid a premium of US$56-60/ton to Japan quotes on a FOB basis compared with nearly US$45-50/ton IRPC received from Phillips 66 for a H2-June cargo. Naphtha markets in Asia have shown signs of improvement early this month on better petrochemical profits, with an unexpected shutdown at JX Nippon Oil & Energy Corp hastening the recovery as naphtha supply was reduced.