US stock build, gas-nap spread keeps gasoline buyers from naphtha

04 October 2013 14:52  [Source: ICIS news]

LONDON (ICIS)--A build up in US gasoline stocks and an unfavourable price spread between European gasoline and naphtha were curbing naphtha demand from the gasoline sector, industry sources said on Friday.

Potential demand for European gasoline, and consequently naphtha, from the key US market was pressured by data from the US Energy Information Administration on Wednesday, showing gasoline stockpiles in the US rose by 3.5m barrels last week.

Meanwhile, the price spread between gasoline and naphtha was relatively steady from last week, and continued to be too narrow to attract blending demand for naphtha.

The wider the price spread, the better is the naphtha demand for gasoline production.

 FOB BARGES ARA (USD/MT) MON  TUE  WED   THU  FRI
 THIS WEEK  54 56 49 52 N/A
 LAST WEEK  58 53 52 49 46

Gasoline versus naphtha average price differential

Naphtha is used as a blending component in gasoline stocks, especially those exported to the key US market.

($1 = €0.73)

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By: Cuckoo James
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