20 August 2013 13:05 [Source: ICIS news]
LONDON (ICIS)--Ethylene contract and spot cracker margins based on naphtha and liquefied petroleum gas (LPG) feedstocks dropped in the week ending 16 August on higher upstream costs and exchange rate fluctuations, according to ICIS margin analysis on Tuesday.
Last week, ethylene contract margins (naphtha-based) slumped by €64/tonne ($85/tonne), as euro-denominated naphtha feedstock costs rose by 3.6%.
A $31/tonne increase in naphtha prices was exacerbated by a 0.1% strengthening of the dollar.
Co-product credits, however, improved by 1.0% as pyrolysis gasoline (pygas) and raffinate-1 values went up.
Ethylene spot margins (naphtha-based) dropped by €38/tonne, primarily driven by higher upstream costs. By contrast, co-product credits increased by 2.8%, as the values of all constituents – particularly propylene, butadiene (BD) and pygas – rose.
LPG-based contract margins followed a similar downtrend to its naphtha-based counterpart, and have dropped by €38/tonne as the euro-denominated cost of LPG rose by 2.8%. However, co-product credits improved by 0.7%.
The advantage for LPG margins over naphtha has increased to €75/tonne.
($1 = €0.75)
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