SINGAPORE: Asia’s naphtha market held steady on Thursday while gasoline crack edged down after Singapore inventories rose.
Taiwanese refiner Formosa Petrochemical has started talks on Thursday to buy light and heavy naphtha for second-half April delivery.
Formosa’s tender comes after YNCC bought at least five cargoes on Wednesday at steady to higher premiums from first half April.
Gasoline crack edged down after data from Enterprise Singapore showed light distillates stocks in the city state rose 419,000 barrels to a four-week high of 15.907 million barrels in the week to March 3.
Asia’s gasoline margins have been boosted by refinery outages in US Texas in February. The severe winter storm caused US gasoline stocks to fall by a record 13.6 million barrels last week to 243.5 million barrels, compared with expectations for a 2.3 million-barrel drop, data from Energy Information Administration showed.
As US refineries resume operations, consultancy FGE expects Asian gasoline cracks to Dubai, which touched a year’s high at $7.20 a barrel on March 1, to correct in coming weeks.
The cracks are expected to stay around $6 a barrel until June on support from recovering demand in Asia and refinery maintenance, FGE analyst Sri Paravaikkarasu wrote in a note.
“Looking ahead, the release of pent-up driving demand during peak summer season in both Asia and the Atlantic Basin will send Singapore gasoline cracks over $7.0/bbl levels in 3Q,” she added.?
OPEC and its allies in will decide on Thursday whether to freeze oil output or raise it slightly from April as a recent price rally is clouded by concern over the fragility of economic recovery during the COVID-19 pandemic. The Intercontinental Exchange is looking to run two types of Dated Brent contracts after June 2022 following pricing agency Platts’ announcement of a major change to its global oil benchmark, a circular from the exchange showed.—Reuters
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