SINGAPORE: Asia’s naphtha crack weakened on Monday as demand is expected to soften with crackers heading into maintenance season, while gasoline margins held steady supported by lower exports from China.

Cracker operators have also started switching to cheaper liquefied petroleum gas (LPG) feedstock, which reduces demand for naphtha, traders said.

Several tenders were awarded last week by buyers in South Korea, China and Japan for cargoes to be delivered in June at lower levels than previous months, they added. Separately, several crackers in Taiwan and Thailand suffered outage last week.

Taiwan’s Formosa Petrochemical Corp restarted on Monday its No. 1 naphtha cracker after a technical fault shut the unit last week, the company’s spokesman said.

The company expects the unit to resume full operating rates in the next few days, he said. The No. 1 cracker at Mailiao with a capacity of 700,000 tonnes per year is scheduled to be shut for maintenance on June 8.

For gasoline, China’s exports in March was at 1.56 million tonnes, down 14.6% from 1.83 million tonnes in March 2020, when the COVID-19 pandemic had dampened Chinese demand for the motor fuel, data from the General Administration of Chinese Customs showed.

Still, the market is watching the impact on fuel demand from a renewed lockdown in New Delhi as daily COVID-19 cases in India hit a new record.

Essar Oil UK, the operator of Britain’s Stanlow oil refinery, said on Friday it was confident it could secure financing to keep the plant running after hitting short-term financial difficulties.

Global commodities trader Trafigura has agreed to buy Angolan state oil giant Sonangol’s 31.78% stake in loss-making Puma Energy for $600 million in a step towards raising its holding to more than 90%.