SINGAPORE: Asia's naphtha crack recovered 1.65 percent to reach a near 22-month high while spot premiums treaded higher on tight supplies.
- Buying interest for naphtha remained strong as the fuel was needed to feed naphtha crackers which are mostly running at high rates in Asia to cater to plastics demand.
- A day after South Korea's Lotte Chem and KPIC were in the market for cargoes, YNCC, SK Energy and Hanwha Total came forward on Tuesday, traders said.
- YNCC bought naphtha for second-half December arrival at Yeosu at premiums around $10.25 a tonne to Japan quotes on a cost-and-freight (C&F) basis, highest premium it had paid since around mid-April 2015
- This mirrored India's Reliance Industries having fetched some $24 a tonne above Middle East quotes late last week when it sold a cargo for early December loading from Sikka to an oil major, as that was the highest premium the Indian seller had fetched since 2015.
- Hanwha Total and SK Energy paid even higher premiums of $12 to $13 a tonne for December cargoes as they had likely purchased a heavier naphtha grade and not paraffinic naphtha like YNCC.
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