UpdateAsia naphtha hits eight-month low on crude slump

04 April 2013 04:14  [Source: ICIS news]

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SINGAPORE (ICIS)--Asia’s naphtha has tumbled to $888-891/tonne on Thursday morning, hitting the lowest since 1 August 2012, in response to hefty overnight losses in global crude futures.

On Wednesday, open-spec naphtha for second-half May contract closed at $911-913/tonne CFR (cost and freight) Japan, according to ICIS data.

US crude futures fell by $2.74/bbl to $94.45/bbl on Wednesday, as weekly supply statistics from the Energy Information Administration (EIA) revealed a much-greater-than-forecast build in crude stocks, which overshadowed a drawdown in refined products. A sell-off in the stock market and in gasoline futures also exerted pressure on oil prices.

Meanwhile, May Brent crude futures closed down by $3.58/bbl on Wednesday to $107.11/bbl.

The Asian naphtha market is also facing a deluge of deep-sea supply from the Western markets, at a time of weakening plastics demand, traders said.

At the close of trade on Wednesday, the second-half May/second-half June naphtha spread narrowed by $1/tonne from Tuesday to a backwardation of $16.00/tonne, ICIS data showed.

By: Felicia Loo

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