Asia Naphtha/Gasoline-Naphtha crack rises, Fujairah stocks fall

Asia’s naphtha refining profit margin rose on Wednesday after inventories at the Fujairah commercial hub declined to a two-week low.

The crack climbed to more than $40 per metric ton over Brent crude oil in a backwardation of $3 per ton, compared with $36.95 a day earlier.

Prices for first-half June naphtha were stable, market participants said. In physical markets, 25,000 tons of second-half June naphtha changed hands at $712 per ton, they added.

“We suggest that the geopolitical situation has added a good $10 per barrel to flat prices meaning that if we see a de-escalation, as seems likely, then we may see naphtha cracks rebound over the next few weeks,” analysts at energy consultancy FGE wrote in a note.

Meanwhile, light distillate stocks at the Fujairah trading hub fell by 284,000 barrels to 7.530 million barrels in the week to April 15, S&P Global Commodity Insights data showed.

NEWS

– Oil prices slipped for the third straight session on Wednesday as likely higher U.S. commercial inventories weighed, while weaker economic data from China and dimmed prospects of interest rate cuts stoked worries about global demand.

– U.S. President Joe Biden will do what he can to ensure affordable gasoline prices, White House senior adviser John Podesta said at an industry conference on Tuesday, when asked about future releases of crude oil from the Strategic Petroleum Reserve (SPR).
Source: Reuters (Reporting by Mohi Narayan; Editing by Devika Syamnath)