31 January 2011 19:20 [Source: ICIS news]
LONDON (ICIS)--European methyl tertiary butyl ether (MTBE) prices hit 28-month highs because of tight inventories, strong global demand and firm gasoline pricing, market sources said on Monday.
Prices on Monday afternoon reached $1,010-1,016/tonne (€747-752/tonne) FOB (free on board) Amsterdam, Rotterdam, or 1.18 as a factor against EuroBob gasoline cash barges.
Imports into Europe from the Middle East have been low during the first quarter because of turnarounds at two of SABIC’s plants in Al Jubail, Saudi Arabia. The company took its 1m tonne/year and 300,000 tonne/year facilities off line in late December and plans to restart them in February.
This interruption to the supply chain coincided with high demand from gasoline blenders taking advantage of the lower factor against gasoline around the turn of the year.
“At 1.13 I think we blended barrels away and there has been no re-supply back into the region, plus exports have left,” a trader said.
Although blending demand in Europe has been hampered by the high factor value, global demand has been high, particularly from South America, and sources reported high levels of exports out of Europe, maintaining the strain on supplies.
The absolute price of MTBE has also been boosted by high gasoline prices, which have been pushed up, in turn, by the rising cost of crude.
On Monday afternoon Brent crude rose above $100/bbl for the first time since October 2008.
($1 = 0.74)
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