NEW DELHI: Asia’s refining profit margins for naphtha and gasoline declined on Tuesday after tepid economic data from China stoked worries about post-COVID recovery in world’s no. 2 economy.
The naphtha crack lingered near January lows at $15.75 a tonne over Brent crude, and the backwardation in the markets narrowed for a second straight day to $1 per tonne.
China’s April industrial output and retail sales growth undershot forecasts, suggesting the economy lost momentum at the beginning of the second quarter and intensifying pressure on policymakers to shore up a wobbly post-COVID recovery.
However, naphtha uptake continues to be a major source of underlying growth in Chinese and global oil demand, buoyed by the enormous scale of its ongoing steam-cracker capacity additions, the International Energy Agency said in its monthly report.
Meanwhile, the gasoline crack also fell to $7.83 a barrel over Brent crude oil, compared with $8.59 a barrel a day earlier.
Asia’s reforming margin, or gasoline’s premium against naphtha, was steady at $20.66 a barrel on Tuesday.
India’s Reliance Industries Ltd, operator of the world’s biggest refining complex, is selling diesel at a cheaper rate than state fuel retailers, several petrol pump dealers said on Tuesday, helping boost local sale of its fuel.
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