Europe naphtha cracker margins rise on weaker prices

25 March 2013 14:28  [Source: ICIS news]

LONDON (ICIS)--European contract cracker margins based on naphtha feedstock rose in the week ending 22 March because of a 1.7% drop in euro-denominated naphtha prices, according to ICIS analysis on Monday.

Naphtha prices showed a week-on-week drop of $21/tonne (€16/tonne) on 22 March but the benefit to margins was held back by a slightly stronger dollar.

Co-product credits were down by 0.7% on lower pyrolysis gas (pygas) and raffinate-1 values.

Conversely, spot margins declined by 13% as softening ethylene spot prices outweighed the lower feedstock costs.

Spot prices are under bearish pressure because of poor derivative demand, particularly that for its key derivative, polyethylene (PE). Co-product credits fell by 1.4% impacted by lower benzene and propylene values.

Contract margins based on liquefied petroleum gas (LPG) increased by €50/tonne on a 3.3% drop in LPG costs but were held back by a 0.4% dip in co-product credits.

Naphtha contract vs spot 22 Mar

LPG vs naphtha margin 22 Mar

($1 = €0.77)

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By: Nel Weddle
+44 20 8652 3214

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