Europe cracker margins rebound, breaking 3-week downtrend

22 July 2013 14:46  [Source: ICIS news]

LONDON (ICIS)--European contract cracker margins based on naphtha feedstock have risen by 18%, breaking a three-week downtrend, on lower feedstock costs and higher co-product credits, according to ICIS margin analysis on Monday.

In the week ending 19 July, euro-based naphtha costs fell by 1.8% on a combination of a $10/tonne (€8/tonne) decline in naphtha prices and a 0.7% weaker dollar. Co-product credits rose by 0.8% on higher pyrolysis gasoline (pygas) values.

Spot margins are also higher, helped by a $50/tonne strengthening in ethylene spot prices, but the gain was limited by a 1.3% fall in co-product credits, which reflected steep decreases in butadiene (BD) and benzene spot prices.

Contract cracker margins based on liquefied petroleum gas (LPG) have improved by €18/tonne ($24/tonne) as feedstock costs fell by 1%. Co-product credits edged up slightly.

LPG margins continue to hold a premium over naphtha margins, but this has narrowed to just €45/tonne.

Contract vs Spot

LPG vs naphtha

($1 = €0.76)

By: Nel Weddle
+44 20 8652 3214

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