15 February 2013 10:36 [Source: ICIS news]
SINGAPORE (ICIS)--Open-spec naphtha prices in Asia surged to the highest levels since 4 April 2012 on Friday, following two physical trades and in response to the regional supply squeeze and strong demand, traders said.
Prices were assessed at $1,072-1,074/tonne (€804-806/tonne) CFR (cost & freight) Japan at the close of trade, according to ICIS.
The first-half April/first-half May spread was done at $37.00/tonne in backwardation between seller Glencore and buyer Shell, while the first half of April contract changed hands between Marubeni and buyer Vitol, traders said.
“The premiums are strong because of the tight supply situation. Crackers are running well,” said a trader.
A stronger ethylene market in recent weeks prompted northeast Asian cracker operators to increase run rates to 90% and above, while naphtha exports from India and the Middle East dwindled, traders said.
Arbitrage cargoes from Europe were limited and inflows into Asia were mostly heavy naphtha, traders said.
The naphtha crack spread surged to $190.03/tonne against Brent crude futures on Friday, up from $165.50/tonne in the previous week, ICIS data showed.
($1 = €0.75)
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