The European naphtha market has risen steadily this week as market expectations of tighter supply in September has fueled bullish sentiment, amid limited demand, as per Platts. On Wednesday, the front-month September CIF NWE naphtha crack swap was assessed at minus US$7.30/b, its highest level since July 12 when the then-August swap was valued at minus US$7.10/b.
Since the start of August, naphtha has climbed slightly more than US$1/barrel relative the ICE Brent crude futures complex on market expectations of a strong refinery turnaround season in Europe in addition to possible maintenance on Sonatrach's 5 mln tpa condensate splitter in mid-September. Sonatrach's splitter is responsible for the export of anywhere from 5 to 7 cargoes of naphtha a month, which are then shipped to Northwest Europe, Asia or Brazil. The marker remains shrouded with concerns about maintenance in September. The current halt in shipments out of Libya's Ras Lanuf, in addition to the recent drop in Libyan crude production, is starting to eat into some of the length in the region. Weak demand from petrochemical end-users in Europe and little in the way of strong gasoline blending opportunities, has weighed on the naphtha market throughout most of the summer. Last week, physical CIF NWE naphtha cargoes were pricing at a small discount to the front-month outright swap.
09-Aug-13 
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