Europe benzene confirmed up €19/tonne for May

30 April 2008 19:14  [Source: ICIS news]

LONDON (ICIS news)--European benzene contract partners  gave final confirmation of May contracts settled up €19/tonne ($30/tonne) on Wednesday, citing higher spot values led by energy and a stronger dollar against the euro.

A final buyer and seller confirmed settling their May contracts at a dollar concept of $1,185/tonne FOB (free on board) NWE (northwest Europe), converted to €761/tonne FOB NWE at an officially agreed exchange rate of €1 = $1.5571.

The April contract had been settled at a dollar concept of $1,172/tonne FOB NWE, and converted to an outright euro price of €742/tonne FOB NWE using a €1 = $1.5796.

Players attributed the price increase to a number of factors.  The relative strength of the dollar against the euro - improved by some 1.4% - and higher spot prices, under the influence of higher crude values, were all seen as being central to the hike.

At the time of the April settlement, Brent crude was valued at $100.20/bbl.  At 17:00 London time on Wednesday, Brent crude was valued at $111.90/bbl, some $10.70/bbl higher, having hit a record high of $117.56/bbl the previous Friday.

Spot benzene, meanwhile, had been traded at levels as high as $1,199/tonne CIF (cost, insurance and freight) ARA  (Amsterdam, Rotterdam, Antwerp) for May on Monday, with bids and offers closing at $1,180-1,185/tonne CIF ARA the following day. 

April contracts had been settled on the basis of a deal done at $1,172.50/tonne CIF ARA.

Buyers had been hopeful in previous weeks that they would see a decrease in the May contract given a record low for the dollar against the single European currency at €1 = $1.60 and spot prices as low as $1,160/tonne CIF ARA in mid-April.

“We had hoped for lower prices, and if the dollar had been as low as it was last week then it would be a different story,” said one buyer.  “But that is the way things are at the moment - crude goes up, the dollar goes down and vice versa.  It’s impossible to know what is going to happen.”

($1 = €0.64)

For more on benzene visit ICIS chemical intelligence

By: Peter Salisbury
+44 20 8652 3214

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