Asia's naphtha reached a six-week high of $29.65 a tonne on Thursday as demand from Taiwan and South Korea emerged. Asia's top naphtha buyer Formosa and South Korea's Hanwha Total were looking to buy cargoes for August arrival. Formosa picked up around 100,000 tonnes of open-specification naphtha for August arrival at Mailiao at discounts between $1 and $2 a tonne to its own price formula on a cost-and-freight (C&F) basis, higher compared to a steeper discount of between $3 and $4 it had paid on May 30.
The Taiwanese buyer had also bought 44,000 tonnes of liquefied petroleum gas (LPG) at a discount of $80 a tonne to naphtha benchmark prices. Some Asian buyers including Formosa are able to replace a portion of naphtha with LPG as feedstock to make petrochemicals. Indian Oil Corp. on June 25 sold 35,000 tonnes of naphtha for July 15-17 loading from Chennai to Vitol at premiums in the high teens a tonne level to its own price formula on a free-on-board (FOB) basis.
This was higher than premiums between $14 and $15 it had fetched for a cargo sold for July 6-8 loading from the same port to Vitol. Asia's gasoline margin was at a five-week high of $3.92 a barrel on stock drawn down in the United States and Singapore. US gasoline stocks fell last week by 996,000 barrels, data from the Energy Information Administration (EIA) showed, contrasting analysts' expectations in a Reuters poll for a 288,000-barrel gain.
Singapore's onshore light distillates stocks eased by 2.04 percent of 255,000 barrels to a three-week low of 12.236 million barrels in the week to June 26, data from Enterprise Singapore released on Thursday.
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