Europe cracker margins lowest since August 2012 on firm naphtha

15 July 2013 15:59  [Source: ICIS news]

LONDON (ICIS)--European contract cracker margins based on naphtha feedstock have fallen to their lowest level since August 2012 on a 2.4% rise in euro-based naphtha costs, according to ICIS margin analysis on Monday.

In the week ending 12 July, the contract margin fell by around 12% week on week. Naphtha prices increased by $36/tonne (€28/tonne) but this was offset by a 1.7% weakening of the dollar against the euro.

The margin fall was also cushioned by a 1% increase in co-product credits because of higher raffinate 1 and pyrolysis gasoline (pygas) values.

Spot margins based on naphtha feedstock fell by about 55% for the same reasons outlined above. Spot ethylene prices were falt in dollar terms.

Co-product credits rose by only 0.2% as higher raffinate 1 and aromatics values just outweighed lower propylene and butadiene (BD) prices.

Contract cracker margins based on liquefied petroleum gas (LPG) were largely unchanged as a 0.3% rise in euro-based feedstock costs was countered by a 0.5% increase in co-product credits.

LPG’s margin advantage over naphtha has increased to nearly €80/tonne.

Contract vs Spot

($1 = €0.77)

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By: Nel Weddle
+44 20 8652 3214



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