Asia's naphtha crack recovered from a three-session low to reach an almost two-week high of $76.28 a tonne after strong demand overturned the impact of high oil prices for now. Formosa and CPC, Taiwan's two key naphtha importers, were out at the same time looking to buy the fuel through tenders issued on Wednesday.
CPC was seeking heavy naphtha and full-range grade for Aug. 5-27 arrival at Kaohsiung while Formosa was seeking open-specification naphtha for Aug. 11-20 arrival at Mailiao. Japan's Showa Denko also emerged this week to buy naphtha for first-half August delivery.
The buyer may have paid a high single-digit premium on a cost-and-freight (C&F) basis to Japan quotes for the open-specification grade but this could not be confirmed as buyer do not comment on their deals. Indian Oil Corp (IOC) sold 35,000 tonnes of naphtha for July 18-20 loading from Chennai to Vitol, who also picked up 50,000 tonnes of full-range naphtha from Kuwait this week for July 19-20 loading.
Traders said the premium the Kuwait's naphtha was above $15 a tonne to Middle East quotes on a free-on-board (FOB) basis but this could not be independently confirmed. Asia's gasoline crack similarly rose but only reached a two-session high of $4.37 a barrel as ample supplies capped gains.
Singapore onshore light distillate stocks, which comprise most of gasoline and gasoline blending components, edged up 1.07 percent, or 129,000 barrels, to reach a two-week high of 12.2 million barrels in the week to June 27, official data showed.
Rise in Singapore inventories came in the same week where US gasoline stocks were also up, rising by 1.2 million barrels, compared with analysts' expectations in a Reuters poll for a 1.3-million-barrel gain.
State-run Saudi Aramco has set its July contract price for propane at $555 a tonne, down from $560 in June. Propane can replace a small portion of naphtha in some crackers, provided that the price of the former is attractive.
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