Asian naphtha prices edged up on rises in oil futures prices on Monday, while the premium against ICE Brent continued to ease as some end-users had preferred alternative cheaper cargoes.
The key open-spec naphtha contract for the first half of March was nationally assessed at $548.50 a tonne on a cost-and-freight (C&F) basis, compared with $544/549 on Friday. Backwardation between the first halves of March and April was $13 a tonne. It had mostly stayed around the $13-$15 level last week, then shrank to $7 late on Friday.
The ICE Brent/naphtha crack - the premium paid for naphtha compared with Brent crude prices - eased by about $5 from Friday to $130 a tonne for the first half of March. The crack had topped $150 last week, the highest since $177 in January 2005.
"There will be more spot requirements for March, mainly from South Korea. But some petrochemical makers chose to increase purchases from term suppliers after spot differentials had jumped, a seller said. "That is slightly weighing down the crack."
Japan's Mitsui Chemical was also expected to buy some spot cargoes for March delivery later this week, traders said. Dealings in physical cargoes had been quiet so far on Monday as many traders focused on a spate of Indian export tenders closing later this week.
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