The weekly ICIS Naphtha price reports are covered by local reporters in Asia, Europe and the US. News within the report can include, when applicable, Brent crude-naphtha crack spreads, arbitrage opportunities, upstream news, production issues, cracker margins and refinery reports along side the up-to-the minute pricing information. Use the report to find out which different factors are driving prices before making vital business decisions.
Updated to Q4 2020
Steady volumes of arbitrage naphtha cargo flows from Europe to Asia weighed on market fundamentals amid limited northeast Asia end-user demand in the early part of the fourth quarter. This saw the market structure mired in a contango. Market sentiment improved towards the end of the fourth quarter following the rollout of coronavirus vaccines, along with expectations of curbs in upstream refinery output. Naphtha’s crack spread gained momentum while the market flipped into a backwardation.
Asia naphtha end-user demand was thin during the early-mid part of the fourth quarter because of cracker shutdowns centred in South Korea. Spot cargoes for northeast Asia trades fetched discounts during this period. Eventual cracker restarts in December and onwards lifted the market. Favourable downstream olefins margins in part helped to encourage spot buying of light paraffinic naphtha. This followed with naphtha spot cargoes achieving premiums towards the later part of the fourth quarter.
Supply remained relatively balanced to tight with the heavier grades facing length amid sluggish blending requirements while lighter grades remained short, amid steady demand from petrochemical units. Reduced refinery run rates and extended turnarounds compounded the tightness.
A strong downstream market and improved olefin margins were the major factors driving demand for Q4 2020. Despite the tug of war between propane, butane and the relatively expensive naphtha for petrochemical market share, naphtha remained the preferred feedstock. Europe remained structurally long on gasoline, weighing on the recovery of demand for heavier grades of naphtha.
We offer the following regional Naphtha analysis and news coverage to keep you informed of factors and developments affecting prices in the Naphtha marketplace.
News & analysis
ICIS price assessments are based on information gathered from a wide cross-section of the market, comprising consumers, producers, traders and distributors from more than 250 reporters world-wide. Confirmed deals, verified by both buyer and seller, provide the foundation of our price assessments.
Our in-depth market knowledge drives our specialist focus, as we recognise the importance of individual market dynamics and not a one-size-fits-all approach.
Over 25 years of reporting on key chemicals markets, including Naphtha, has brought global recognition of our methodology as being unbiased, authoritative and rigorous in preserving our editorial integrity. Our global network of reporters in Houston, London, Singapore, Shanghai, Guangzhou, Mumbai, Perth and Moscow ensures unrivalled coverage of established and emerging markets.
Commentary shows the latest market movement and weekly prices, it is a very fast moving market with lots of factors influencing supply and demand and therefore the price.
Naphtha is a light flammable liquid containing a mixture of hydrocarbon molecules typically with between 5 and 10 carbon atoms. It mainly consists of straight chain alkanes (paraffins) but it may also contain cyclohexanes (naphthenes) and aromatics.
Naphtha is produced primarily from the distillation of crude oil and is the intermediate product between the light gases and the heavier kerosene. It can also be a component of natural gas condensates, the liquid hydrocarbons contained in natural gas.
There are a number of different classes of naphtha and similar naphtha types may be called by different names. Light naphtha will normally have a higher content of straight chain paraffins and is sometimes referred to as paraffinic naphtha or straight run gasoline. Heavy naphtha usually contains more naphthalenes and aromatics and may be called N&A naphtha.
In the petrochemical industry, naphtha is an important feedstock for steam crackers in the manufacture of olefins (ethylene, propylene, butadiene) and aromatics (benzene, toluene, xylene). Paraffinic naphthas are preferred for steam crackers but heavier naphthas can also be used.
Light naphtha can also be used in industrial solvents and cleaning fluids. Applications include varnishes and paints, shoe polish, lighter fluid and fuel for portable stoves and lanterns.
Naphtha is also used to make high octane gasoline using a catalytic reforming process. This process converts heavy, low octane naphtha into high octane products.
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