Asia Naphtha/Gasoline-Naphtha edges up, fundamentals remain weak

SINGAPORE: Asia's naphtha crack was up marginally at $58.38 a tonne while the contango between second-half January and second-half February remained at $2 a tonne for a second day, reflecting a market awash with supply.

Contango is a market structure that reflects ample supplies versus backwardation which shows strong fundamentals.

The Asian gasoline crack however retreated to a three-session low of $8.65 a barrel, mirroring the softness in the US market following an unexpected build up of 3.4 million barrels in stock levels against a forecast of an increase of 1.9 million barrels.

In contrast, Singapore's light distillates stocks, which comprise mostly gasoline and blending components for petrol, fell to a two-week low of 12.1 million barrels in the week to Dec. 7, official data showed.

The current levels were 11.3 percent lower than a year ago.

SINGAPORE CASH DEALS: The Singapore cash market was marked by an absence of gasoline deals following 350,000 barrels of petrol being traded in the previous session.

Buyers such as Singapore trader Hin Leong, who had snapped up six of the seven cargoes in the previous session, was still looking to buy more cargoes but its bids fell short of sellers' expectations.