Asia's naphtha crack extended losses for the second day on Thursday to reach a three-session low of $91.08 a tonne on higher supplies from the West. After two months of lower-than-average volumes arriving in the East in September and October, Europe is expected to resume shipping a large number of cargoes to Asia from November, traders said.
The reasons behind the high volumes were unclear although traders said it could be due to cracker maintenance but this could not be independently confirmed. In South Korea, Lotte Chemical has a scheduled one-month maintenance at its 1 million tonnes per year (tpy) cracker in Daesan starting on October 16. The shutdown would wipe out quite a substantial amount of demand, traders said.
Japan's JX Nippon Oil & Energy Corp in the meantime has shut a 140,000 tonnes per year (tpy) propylene-making unit at its Kawasaki plant for an indefinite period due to poor margins. But the company will keep its naphtha cracker running at high rates due to healthy cracking margins as crackers produce a diversified chain of petrochemicals rather than on single product.
In South Korea, a petrochemical maker was in the market for second-half November naphtha cargoes. The results were not clear but traders said the premium paid Yanbu Aramco Sinopec Refining Co (Yasref) is operating its refinery at 75 percent capacity, or 300,000 barrels per day (bpd) for the last week as the refiner is repairing a leak in the exchangers of one of the two hydrocracker trains, sources said.
GASOLINE LOWER Asia's gasoline crack hovered at a five-week low of $10.71 a barrel for the second session, dragged down by a rise in crude oil prices. Singapore's onshore weekly light distillates stocks, which comprise mostly gasoline and gasoline blendstocks, fell 10 percent, or 1.157 million barrels, to over a year low of 10.287 million barrels in the week for October 7.
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