03 November 2011 17:01 [Source: ICIS news]
HOUSTON (ICIS)--A lack of imports and an increase in buyers bolstered US Gulf heavy naphtha in the spot market, said Gulf coast naphtha traders on Thursday.
US Gulf naphtha has been trading at 6 cents/gal under the spot market price of winter-grade US Gulf gasoline.
On Wednesday, the price of the winter-grade gasoline was $2.6150/gal, and naphtha was at $2.5550/gal.
Demand for naphtha has strengthened, bringing more buyers to the market and firming prices at a discount of 6 cents/gal. Early last week, naphtha traded at 10 cents/gal under spot gasoline.
Trades said demand for naphtha has improved for gasoline blending. Naphtha is the feedstock for reformate, a high-octane gasoline blendstock.
Valero was heard as a buyer for heavy naphtha early in the week for its 142,000 bbl/day Corpus Christi refinery in Texas, which is set for a three week turnaround of its crude and coker unit any time now. In addition, traders said BP and CITGO have been market buyers.
Also bolstering naphtha prices has been tightening supply. The arbitrage for imports of naphtha from Europe has been closed through most of the year, and the arbitrage from Latin America is also closed, traders said.
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