06 September 2010 09:17 [Source: ICIS news]
By Felicia Loo
Second-half October naphtha was pegged at $681.50-684.50/tonne (€531.57-533.91/tonne) CFR
“The arbitrage is closed,” said a trader.
A narrow East-West spread, which determines the profitability of moving regional naphtha to another, also crimped the chances of arbitrage flows, traders said.
“The spread at $12-13/tonne is far too narrow,” a second trader said.
A lack of fresh Mediterranean arbitrage supply to
Traders attributed the price gains to prices in
Tight supply of ethylene in
Ethylene prices rose to the four-digit mark of $1,000-1,030/tonne CFR NE Asia, from month-ago levels of $890-910/tonne, ICIS data showed. Given higher ethylene prices, steam cracker margins remained attractive for many integrated players to run their plants at maximum rates.
To take advantage of current high margins, Korea Petrochemical Industry Co (KPIC) moved the planned October turnaround at its 470,000 tonne/year naphtha cracker in Onsan this year to April 2011. The exact date for the turnaround, which would last 25 days, has yet to be finalised.
“The (naphtha) crack spreads are still being supported and likely to remain so for some time. This would encourage refiners to run more light crudes/condensates,” said a trader.
($1 = €0.78)
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