SINGAPORE: Spot naphtha premiums for north Asian buyers stayed firm on Tuesday supported by robust demand, traders said.

Three naphtha crackers in South Korea are set to resume operations in December and January after the units were shut for months for maintenance and outage issues, company officials said.

Petrochemical producers in Asia have been buying more naphtha to increase their output because olefins margins are strong while benzene profits have improved, traders said.

Taiwan’s Formosa Petrochemical bought 100,000 tonnes of naphtha with minimum 75% paraffinic content at premiums of about $13 a tonne to Japan quotes on a cost-and-freight (C&F) basis for February delivery to Mailiao, traders said. This would be the highest premium in six months, according to Reuters data.

Spot premiums for February cargoes heading into South Korea stayed firm at $15 to $18 a tonne depending on the oil’s paraffinic content and other conditions, traders said.

Sentiment in Asia’s gasoline market has been dragged down by travel curbs in the United States and Europe to stem rising COVID-19 cases.

US drivers logged 8.8% fewer miles in October, according to the Department of Transportation, while API’s data showed that gasoline consumption fell in November.

Last week, US gasoline stocks may have risen for the sixth straight week, a preliminary Reuters poll showed on Monday.

In Europe, refineries’ gasoline output was up 3.1% in November from the previous month and down 4.4% on the year at 2.3 million barrels per day, according to Euroilstock data. Portugal’s oil and gas company Galp will fully cease processing hydrocarbons at the smaller of its two refineries in Matosinhos near Porto from next year due to the impact of the COVID-19 pandemic and the regulatory environment.