Asian naphtha price was at a three-week high on Thursday, held up by higher Brent crude, but sentiment stayed on the downward spiral due to ample supplies, which also caused the intermonth spread to flip to a discount for the first time in about a month.
Crack spreads were also heading South, falling for the fifth-straight session and closed at their lowest since August 17. The weak market ruled in favour of South Korea's LG Chem who bought two 25,000-tonne open-spec grade parcels, each for second-half October delivery to Daesan and Yosu, at discounts of about $4.00-$4.50 a tonne to Japan spot quotes on a cost-and-freight (C&F) basis.
These prices were sharply lower compared to premiums of $2.00 a tonne C&F it had paid on August 19 for 75,000 tonnes for first-half October delivery. "Incoming arbitrage, ample Middle East spot supplies and Formosa not needing any October barrels have weakened the market," said a Singapore-based trader.
Kuwait Petroleum Corp (KPC) sold 150,000 tonnes of spot naphtha for October loading to a Japanese trader, and a Western trader at premiums of $11.00-$12.00 a tonne to Middle East quotes on a free-on-board (FOB) basis. But traders said there could be more. "I heard at least 200,000 tonnes were sold at a premium of $10.00-$12.00 a tonne FOB," said a North Asian trader.
Comments
Comments are closed.