Asia's naphtha spot purchases from South Korean petrochemical makers came to a standstill due to the festive holiday, with the front-month first-half February price lagging the following month's value by $5 for the third straight session on Wednesday. Front-month value falling below the following month's price reflects a weak market. Naphtha supplies in Asia were persistently high since September.
This has likely prompted South Korea's S-Oil Corp to hold back its term talks, traders said. S-Oil has instead been selling its cargoes in the spot market, with the latest offerings for two 33,000-tonne cargoes for February 3-7 and February 11-15 loading. Traders expect the third-largest refiner of South Korea to wrap up the deals by late Wednesday. Algeria has closed its port due to bad weather, affecting some naphtha shipment from the Skikda refinery although traders said the exact numbers of cargoes affected was unclear. "Skikda's delay gives some slight support but most news is still bearish for the market. It is very quiet without end-users in the market," said an industry source.