Asia Naphtha/Gasoline-Naphtha timespread rises indicating tight supplies

SINGAPORE: Asia's naphtha crack recovered to a two-session high of $86.53 a tonne, while the intermonth timespread climbed to a four-session high of $26.50 a tonne, indicating tight supplies.

The intermonth timespread refers to the difference between prices in front-month first-half December and first-half January. When supplies are tight, the front-month prices are typically higher than following months.

More than 1.6 million tonnes of naphtha from Europe, the Americas and the Mediterranean are expected to land in Asia next month, but supplies are still expected to be tight because of lost production in October, industry sources said.

"Although the market came off last week, prices are still high. We cannot say that fundamentals are weak yet," said one source who tracks east-west cargoes.

December arriving cargoes so far are seen at 700,000 to 800,000 tonnes but the final volumes are likely to be higher as there is still time to book cargoes for December arrival.

Amongst the December arriving cargoes, at least one at 80,000 tonnes from Algeria was provisionally booked by Saudi Aramco on tanker British Restraint, shipping reports showed.

* GASOLINE: Asia's gasoline crack was at a two-session high of $8.47 a barrel due to demand from pockets of Asia, including Southeast Asia and India.

- Sellers Indian MRPL and Chinese CNOOC emerged to offer gasoline for November shipments.

- MRPL offered 25,000 tonnes of gasoline for Nov. 18-20 loading from New Mangalore, while CNOOC offered 10,000 tonnes for Nov. 9-13 loading from Basuo Terminal and up to 39,000 tonnes for Nov. 20-21 loading from Dagang Terminal.