Asia Naphtha/Gasoline-Naphtha crack declines by 51% this week, backwardation shrinks to $7/t

Asia’s naphtha market weakened by about 51% this week on worries about abundant supplies and volatility in crude oil benchmarks, market participants said.

The refining profit for naphtha recouped some losses and close about $3 higher at $36.13 metric tons on Friday and the backwardation narrowed to $7 a ton from $9 a day earlier.

Middle East naphtha exports hit 4.42 million tons in March, the highest since October last year, as regional refineries returned to production after turnarounds and requirements from Asia increased amid higher operating rates at some downstream petrochemical facilities, analysts at LSEG Research said in a note.

Meanwhile, naphtha inventories at the Amsterdam-Rotterdam-Antwerp (ARA) refining and storage hub rose to 449,000 tons in the week to April 4, compared with 437,000 in the prior week, Insights Global data showed.

NEWS

– Fuel exports via Russian Railways’ network fell 12.7% year-on-year in March, the Interfax news agency reported, citing the company’s deputy director general Alexei Shilo.

– Two senior executives at global commodity trader Trafigura will retire this year, the company said on Friday, clearing the way for a new generation of management in the latest reshuffle at the firm.

– Oil prices extended gains on Friday and headed for a second weekly gain, supported by geopolitical tensions in Europe and the Middle East, concerns over tightening supply and optimism about global fuel demand growth as economies improve.

SINGAPORE CASH DEALS O/AS

Three gasoline trades, no naphtha deals.
Source: Reuters (Reporting by Mohi Narayan)