04 March 2010 17:06 [Source: ICIS news]
BRUSSELS (ICIS news)--The European benzene market will be characterised by continued volatility and a lack of clear direction in the second quarter, players said on Thursday.
"It is a very nervous market," said one seller, speaking from the sidelines of the European Petrochemical Luncheon in ?xml:namespace>
Another source said that in the absence of firm demand, crude would be the main driver of price levels.
On the spot market, benzene values crept up by $10/tonne (€7.30/tonne) earlier on Thursday to $940-950/tonne CIF (cost, insurance and freight) ARA (
However, some players said that these factors were not the real drivers of benzene prices.
One consumer argued that the key factor behind price volatility in the market was the lack of confidence among players and low inventory targets.
"This is why we have seen spot prices fluctuate so much in the course of one day," said the consumer. "There are no stocks, so any sudden developments will have more of an effect."
Another buyer agreed, but added that the shutdowns and technical issues seen earlier this year were distorting the market.
The buyer explained: "We have seen product moving between regions, such as from Asia to the
The buyer felt that sentiment in the larger US market tended to affect price ideas in
Another consumer agreed that players would continue to keep inventories low, but felt that the spread between benzene and naphtha would stabilise around the $300/tonne mark in the second quarter.
"With light naphtha cracking in the summer, this could also lead to less benzene being produced, which could keep the market balanced," the consumer added.
($1 = 0.74)
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