SINGAPORE (ICIS)--Asia’s naphtha crack surged to the highest levels in nearly 11 months on Friday, supported by a flurry of physical deals and rising crude futures, traders said.
The naphtha crack spread versus the February Brent crude futures was assessed at $172.80/tonne – the strongest levels since 15 February last year when it closed at $190.03/tonne, ICIS data showed.
Open-spec naphtha prices rose by $6.25-7.25/tonne from midday to $975.50-977.50/tonne CFR Japan on Friday, ICIS data showed.
At the close of trade on Friday, the first-half March contract was done at $967/tonne, while the second-half March contract traded twice at $958/tonne, traders said.
Meanwhile, the first-half/second-half March spread was traded at $9.25/tonne and the the second-half February/second-half March spread was done at $18.50/tonne, they added.
The Asian region is facing strong naphtha demand, as healthy margins are encouraging high cracker run rates, traders said.
Even as the arbitrage supply would be hefty, the strong regional demand is likely to overshadow the surplus inflows.
Asia is expected to receive 1.8m-2.1m tonnes of deep-sea naphtha supply from the western regions for delivery between January and the first half of February, trader said.