Europe February benzene CP confirmed at €521/tonne

Author: Truong Mellor

2015/02/02

LONDON (ICIS)--The February European benzene contract has been confirmed at €521/tonne, down €47/tonne from the previous settlement, as the initial settlement heard late on Friday 30 January received further support from players in the market on Monday morning.

The settlement was agreed at a US dollar concept of $590/tonne FOB (free on board) NWE (northwest Europe) and converted to the euro price at the agreed exchange rate of €1:$1.1324.

Despite a brief upturn in spot pricing towards the end of last week, sentiment in the European market remained sluggish amid ample availability. With cracker margins strong throughout January, this kept pygas supply on the long side, adding some downward pressure on the market.

With no real upward momentum seen from derivative markets, traders felt that there was still no cause for any bullishness in the European market. However, many felt that the market had now perhaps reached a certain equilibrium for February, provided that oil and energy prices remain within a steady range.

Following the settlement of the downstream styrene barge contract earlier on Monday at a €55/tonne reduction, there is also a sense that this could see a surge in downstream demand, as producers look to build stock ahead of the traditional peak season towards the end of Q1. This could help support benzene consumption in the coming weeks.