11 March 2013 14:50 [Source: ICIS news]
LONDON (ICIS)--European contract cracker margins based on naphtha feedstock have slumped around 12% week on week on the back of a slight increase in naphtha prices and a 1.7% drop in co-product credits, according to ICIS analysis on Monday.
On 8 March, naphtha values were up by $16/tonne (€12/tonne) compared with data on 1 March, resulting in a 1.7% increase in euro-denominated naphtha costs. The dollar to euro exchange rate was virtually unchanged.
The contract margin average for March to date is €544/tonne – the highest since June 2012.
In contrast, contract margins based on liquefied petroleum gas (LPG) were up by 19% because of a 6.1% decline in LPG prices. LPG prices softened by more than $50/tonne in the week ending 8 March.
The margin advantage of LPG cracking versus naphtha cracking of more than €80/tonne will continue to give cracker operators incentive to crack light LPG feedstock where possible.
($1 = €0.77)
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