Europe naphtha hits 7-month low at $811-821/t

15 September 2008 16:14  [Source: ICIS news]

LONDON (ICIS news)--Europe spot naphtha has hits its lowest level since early February at $811-821/tonne (€568-575/tonne) on the back of tumbling crude prices, traders said on Monday.

 

The bid-offer range, assessed on a cost, insurance and freight (CIF) northwest Europe (NWE) basis by global chemical market intelligence service ICIS pricing, has plunged $64/tonne since Friday even as crack values worsened from -$2/bbl to around -$3.65/bbl.

 

Traders attributed the worsening crack values to the reported lack of major damage to Gulf of Mexico coast refineries from Hurricane Ike.

 

With US refineries relatively unscathed, there is no immediate need for naphtha to be transported for gasoline blending.

 

However, they did see the possibility of crack values resuming their march to positive territory in the near future, especially with US Gulf refineries continuing to remain closed.

 

"Ike was not as bad as expected, it seems," said one trader. "But this is short-term relief. Let’s see what happens in the long term, because [US] inventories are going to be very low."

 

($1 = €0.70)

 

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By: Alex Davis
+44 20 8652 3214

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