Asia's naphtha crack slipped 4 percent to $81.13 a tonne on Tuesday after a 30 percent spike in the previous session. Traders looked past the marginal fall in value and focused instead on possibly fewer European and Mediterranean cargoes arriving in the East in September as high freight rates hamper the west-to-east trades.
"The cracks are down by a bit but it is still a strong value compared to last week," said a Singapore-based trader. "Spot prices are still in discount but that has narrowed slightly." South Korea's YNCC bought two naphtha cargoes totalling around 50,000 tonnes for first-half September arrival at Yeosu at a discount of about $3 to $4 a tonne to Japan quotes on a cost-and-freight (C&F) basis, traders said.
This reflected a slight improvement compared to an average of $5 a tonne discount to Japan quotes on a C&F basis last week. Concerns over freight rates for long-range vessels mounted as traders said they expected the impact to spread to freight rates related to medium-range tankers, which are largely used to transport naphtha within Asia. In China, naphtha imports at 655,169 tonnes for June were at a new high, surpassing a previous record of nearly 560,000 tonnes in October 2014, official data showed.
The bulk of the imports, or about 32 percent of the total volume, were from Russia. China only became a net importer of naphtha in 2009.
GASOLINE: The Asian gasoline crack was at a three-session low of $15.20 a barrel. China exported about 496,000 tonnes of gasoline in June, with the bulk of its cargoes going to Singapore. China's June gasoline exports showed a 21 percent jump, or about 86,000 tonnes, from the monthly average for the first five months of 2015.
SINGAPORE CASH DEALS: Phillips 66 sold to Shell a 95-octane grade gasoline cargo for August 8-12 loading at $75.70 a barrel, making this the onnly cash deal for the session.
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