29 May 2013 12:04 [Source: ICIS news]
LONDON (ICIS)--European naphtha-based contract cracker margins rebounded in the week ending 24 May because of a 2.9% drop in feedstock costs, according to ICIS margin analysis.
On 24 May, a $19/tonne (€15/tonne) fall in naphtha prices combined with a 0.8% weakening of the dollar versus the euro. Co-product credits edged up slightly.
Spot margins were also higher because of the weaker feedstock but this increase was limited due to a 1.6% fall in co-product credits, mainly because of a $150-200/tonne drop in spot butadiene (BD) prices.
Spot margins are almost €340/tonne lower than contract margins, highlighting again the preference for ethylene producers to run crackers at rates closely aligned to contractual needs.
Contract margins based on liquefied petroleum gas (LPG) increased by €28/tonne following a 2% fall in feedstock costs. However, LPG margins continue to hold a premium over naphtha.
($1 = €0.78)
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