24 March 2005 05:02 [Source: ICIS news]
SINGAPORE (CNI)--Asian producers and traders are expecting benzene prices to rise in late Thursday trading in response to the US price surge overnight, but the extent of the price increase remains unclear.
Late on Wednesday, US benzene prices shot up to $3.95/gallon FOB US Gulf Coast from $3.77/gallon FOB US Gulf Coast. The US price rise was attributed to a deadly explosion and fire at BP’s Texas City refinery.
However, a potential price rise in the Asian spot market late on Thursday is expected to be capped by the current ample supply.
A South Korean trader said: “Asia is currently in a long position for benzene and we are currently assessing if the explosion will affect Asian pricing."
A major South Korean producer said that it was monitoring bids from Asian buyers to ascertain market sentiment.
“Benzene markets were softening yesterday (Wednesday) with deals done around $1,105-1,110/tonne FOB Korea due to falling US crude values,” he said.
“The market direction is now unclear with crude softening and US benzene prices rising significantly on the BP explosion.”
A Taiwanese trader and a Chinese trader are adopting a wait-and-see stance, chosing to withhold their offers until late Thursday.
The Chinese trader said that it was likely that offers would be revised upwards if US benzene values stayed in the $3.90-3.95/gallon FOB US Gulf Coast range.
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