Europe ethylene cracker margins fall on rise in naphtha, LPG costs

LONDON (ICIS)–European cracker margins have fallen week on week on the back of a rise in euro-denominated naphtha and liquefied petroleum gas (LPG) costs, ICIS margin analysis showed on Monday.

In the week to 15 September, naphtha costs rose by 3%, while those for LPG rose by 2%.

Contract naphtha-based margins fell 9% week on week as a result of the increase in naphtha costs as well as a 1% decline in co-product credits.

Spot naphtha-based margins fell by 4% week on week but co-products credits were up by 1%.

Spot naphtha-based margins are currently €72/tonne or 13% higher than those for contract.

Despite the drop in naphtha-based cracker margins, they remain at a premium to those for LPG with current analysis showing a 15% lead on the latter.

Contract cracker margins based on LPG feedstock were down 4% week on week. Co-product credits were flat.

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