Asia naphtha inter-month spread widens to $5.25/t
26 May 2008 05:19 [Source: ICIS news]
SINGAPORE (ICIS news)--Asian naphtha inter-month spreads have widened by another $1.50/tonne to reach $5.25/tonne this week on strong market sentiments, industry sources said on Monday.
The spreads between first half of July and first half August in the CFR (cost and freight) Japan naphtha market, which was seen at discount of $2.75/tonne towards the middle of May, flipped back into backwardation last week due to strong buying interest from northeast Asian end-users.
South Korean end-users dominated the market as they sought term naphtha supplies for the second half of 2008 until the second half of 2009. Taiwanese end-users were also October to December naphtha spot cargoes.
The backwardation has since widened from $3.75/tonne late last week to $5.25/tonne early this week.
The second half of July and second half of August spreads were seen widening by $1/tonne to a backwardation of $4/tonne; while the first half of August and first half of September remained unchanged at $2.50/tonne.
Asian naphtha prices were up 18.34% versus gains of 19.50% in the Brent crude markets since early May.
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By: Desmond Chia
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