Asia's naphtha falls to one month low

Asia's naphtha crack fell to near one month low of $93.75 a tonne on Monday as high feedstock costs squeezed petrochemical margins, weighing on the fuel's demand. The naphtha crack value hit a near two-year high of $124.60 a tonne last week, as concerns of tight supplies pushed prices higher.

But the high spot premiums is making the use of naphtha in petrochemical production uneconomical, which could potentially lead to some run cuts at crackers that process naphtha into petrochemicals. Refinery maintenance in the Middle East in the fourth quarter, including facilities in Qatar and Saudi Arabia, and an upcoming turnaround in the United Arab Emirates added to the supply woes, industry sources said.

The supply crunch has persisted since September, when drone attacks hit Saudi oilfields. Asia's gasoline crack extended losses to reach a 3-1/2 month low of $5 a barrel, down from $5.47 a barrel on Friday, as ample stocks were seen across key regions. An expected rise in Chinese exports of the motor fuel is also dampening sentiment, trade sources said.

China's crude oil throughput in November rose 10.1% from the same month a year earlier, to the second-highest on record, as refineries in the world's no. 2 oil consumer ramped up production amid steady profit margins. Crude processing volumes reached 56.08 million tonnes, equivalent to about 13.65 million barrels per day (bpd), data released by the National Bureau of Statistics showed on Monday. That was a fraction below the record of 13.75 million bpd reached in September, and up from October's 13.62 million bpd.