The Asian naphtha price differential between second-half October and second-half November was at a discount of $3.50 a tonne on Friday as ample supplies persisted. It marked a fourth straight session that the open-spec benchmark price was at a discount. "The market is going from bad to worse as the glut persisted," said a Singapore-based trader.
A South Korean end user has bought a first-half November naphtha cargo through private negotiations at a discount of $4.00 to $5.00 per tonne to Japan quotes on a cost-and-freight (C&F) basis, traders said. The last time prices were seen this low in South Korea was in 2011 when LG Chem bought a cargo for second-half July arrival at a discount of $5 through an open tender, Reuters data showed.
Indian premiums similarly fell to 2011 levels. Mangalore Refinery and Petrochemicals Ltd (MRPL) sold 50,000 tonnes of naphtha on Thursday to oil major Shell for October 28-30 loading from New Mangalore at a premium of about $11 per tonne to Middle East quotes on a free-on-board (FOB) basis. Indian Oil Corp (IOC) sold 35,000 tonnes for September 24-25 loading from Chennai to Vitol at a premium of about $4 a tonne to IOC's price formula on a FOB basis.
Kuwait was heard to have sold naphtha for October 10-15 loading to BP at a premium of $6 to $7 a tonne to Middle East quotes on a FOB basis but this could not be directly verified. For the first seven months of this year, Kuwait commanded a premium level of more than $30 a tonne.