Asia naphtha, aromatics fall as crude dives

20 March 2008 03:39  [Source: ICIS news]

SINGAPORE (ICIS news)--Asian petrochemical prices fell on Thursday, with naphtha down over $35/tonne (€22.4/tonne), as crude continued its decline after sharp falls overnight.

Asian naphtha prices opened $35.75/tonne lower at $863-866/tonne CFR (cost and freight) Japan for first-half May. Naphtha demand was also expected to weaken ahead of the cracker turnaround season in Asia.

Crude futures continued to fall on Thursday after NYMEX light sweet crude futures for May delivery dived $5.96/bbl to settle at $102.54/bbl overnight as economic worries returned to the front burner and overshadowed a set of supportive supply statistics.

On Thursday, US May crude futures were down $0.85/bbl to $101.69/bbl, sharply down from the record $111.80/bbl on Monday.

Benzene values in Asia reacted quickly to the slide in crude and were down $15/tonne from Wednesday’s close.

Thursday’s trades started with offers heard initially at $1,095/tonne FOB (free on board) Korea for big berth May shipments, but they fell to $1,085/tonne FOB Korea and met a bid at $1,075/tonne FOB Korea and prices were assessed at $1,075-1,085/tonne FOB Korea at mid-day.

The toluene market also turned bearish with prices notionally assessed $10/tonne lower than Wednesday at $1,000-1,010/tonne FOB Korea and offers were heard at $1,010-1,015/tonne FOB Korea for May loading cargoes, $5-7/tonne lower than yesterday’s deals. Buyers were on the sidelines.

Styrene monomer (SM) prices were $5/tonne lower in Asia on Thursday from the previous day and a deal was done this morning at $1,430/tonne FOB Korea for second-half April shipment while bids and offers on Thursday were at $1,425/tonne and $1,435/tonne respectively on an FOB basis.

However, tight supply in some markets such as monoethylene glycol (MEG) was helping to support prices, an MEG seller said.

Shares of energy companies in the region also dipped in line with falls at the stock indices with Chinese energy stocks down nearly 7.5% on Thursday as investors reacted to PetroChina’s disappointing 2007 earnings and the insufficient subsidy received by Sinopec to cover all of its refining losses.

In South Korea, SK Energy’s shares were down 3.3%, more than the nearly 2% fall for the KOSPI index.

($1=€0.64)

Clive Ong, Desmond Chia, Mahua Chakravarty and Hong Chou Hui contributed to this article.

By: Florence Tan
+65 6780 4359

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