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 Q2 2019
A steady flow of western-origin naphtha arbitrage flows to Asia weighed on Asia naphtha markets that were well supplied in the second quarter. Asia’s naphtha crack spread to prompt-month ICE Brent crude oil futures languished in negative territory in early June, levels not seen in over a decade amid bearish market fundamentals. Naphtha’s forward market structure was mostly in contango in the second quarter, reflecting bearish market fundamentals.
Steady northeast Asian naphtha demand for downstream petrochemicals production helped to cushion the market during most of the second quarter, while tracking movements in global crude oil futures. A pick-up in downstream demand for petrochemicals amid cracker restarts along with expansions provided some support during the latter part of the second quarter. Naphtha’s crack spread to Brent crude oil futures moved back to positive territory in late June as market sentiment improved.
European open-specification spot naphtha availability lengthened in Q2 amid the onset of a heavy planned maintenance schedule downstream that started in late April, and a number of unplanned issues affecting multiple crackers during this period. Supply length was tempered by refinery operating rate limitations amid strike action at Shell’s Pernis site in April and contaminated crude supplies from the Druzhba pipeline that affected a number of complexes in eastern and central Europe.
Naphtha demand remained structurally weak throughout the quarter, despite refinery issues hampering production in Europe. A wide spread versus alternative feedstock propane led to crackers favouring LPG and limiting buying interest. A heavy planned turnaround schedule and a number of unplanned cracker outages further reduced consumption throughout much of the period. Export demand to Asia varied month-to-month but soaked up much of the surplus supply, as the arbitrage window remained open.
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.
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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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