Asian naphtha prices fell on Tuesday along with its premium against Brent crude as Middle East and Indian supply continued strong, traders said on Tuesday. Benchmark open-spec second-half January naphtha was valued at $556.00 a tonne on a cost-and-freight (C&F) basis, down from $560.00 on Monday.
The Brent/naphtha crack spread for second-half January was valued at around $91.5 a tonne, slightly lower than Monday, after a steep $20 loss last week from nearly $110. The fall came on arbitrage supply news that 338,000 tonnes of Mediterranean and European naphtha were coming to Asia.
"Traders and end-users are both aware that there will be steady supply," said a Seoul-based trader. South Korea's Yeochun Naphtha Cracking Centre (YNCC) is still running its 860,000 tonnes per year (tpy) cracker below capacity after coming back from a turnaround on Friday to expand it by 350,000 tpy.
Industry sources said earlier in the day that YNCC might shut down the cracker due to technical problems but the company denied this. SK Corp also restarted its 620,000-tpy No 2 cracker on Monday, after coming back from a turnaround that started on December 1 to fix mechanical problems. December Singapore naphtha swaps were valued at $58.90 a barrel, with the December and January spread quoted at a 30-cent backwardation.
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