Asia's naphtha crack dived by more than 220% to its lowest since the 2008 financial crisis as supplies remained abundant despite global refineries cutting runs to combat a hit to demand because of the coronavirus pandemic.
Naphtha crack, or the price of naphtha against that of Brent crude, flipped into a discount for the first time in a week and hit minus $23.60 a tonne, lowest since December 2008.
The lowest crack value since Reuters started tracking the data was on Nov. 4, 2008 at a discount of $189.75 a tonne. Japan's Idemitsu was out seeking naphtha and it may have paid a premium of about $2 a tonne to Japan quotes on a cost-and-freight (C&F) basis for a cargo scheduled for first-half May arrival at Tokuyama.
The deal came a day after South Korea's Hanwha Total had a paid a discount of $1.50 to $1.75 a tonne to Japan quotes for a heavy full-range naphtha cargo scheduled for first-half May arrival at Daesan.
India's Hindustan Petroleum Corp Ltd (HPCL) reissued a tender to sell 17,000 tonnes of naphtha to be co-loaded with 13,000 tonnes of gasoline for April 20-22 loading from Mumbai through a tender closing on Thursday.
Oil & Natural Gas Corp (ONGC) has an outstanding tender to sell 30,000 tonnes of naphtha for April 12-13 loading from Hazira, it's first such offer since 2018. ONGC had previously stopped exporting naphtha from Hazira as supplies were diverted to OPaL which operates a 1.1 million tonnes cracker.
Asia's gasoline crack plunged by more than 230% to hit a discount of $6.78 a barrel, lowest since December 2008. The steep discounts on gasoline margins have prompted Taiwan's CPC to lower refinery throughput and shut a 25,000 barrels per day gasoline-making unit at its Talin refinery about two weeks ago.
An industry source said CPC will not sell spot gasoline cargoes given the demand destruction. CPC's last spot deal was done last month when it sold a cargo for April loading at a premium.