SINGAPORE: Asia's naphtha crack rose for a second straight session on Thursday, partly buoyed by a slight drop in Western arbitrage arrivals this month ahead of an expected supply surge in July.

The naphtha crack climbed to $97.38 per tonne on Thursday, the strongest since June 14. It was at $96.63 per tonne a day earlier.

Western naphtha arrivals to Asia are set to rebound to around 2.3-2.4 million tonnes in July, which compares with a monthly average of 2.16 million tonnes year-to-date, Refinitiv Oil Research assessments showed.

Asia's gasoline crack rose to $6.28 per barrel on Thursday, 38 cents higher from Wednesday, riding on hopes for recovering demand as countries ease COVID-19 restrictions.

Singapore's light distillate inventories fell 5.2% to a two-week low of 13.5 million barrels in the week to June 23, according to Enterprise Singapore data.

Weekly Singapore light distillate inventories have averaged 14.24 million barrels this year, compared with an average of 14.25 million barrels in 2020, Reuters calculations showed.

US gasoline stocks fell by 2.9 million barrels in the week to June 18, compared with analysts' expectations for an 833,000-barrel rise, the Energy Information Administration said on Wednesday.

Sri Lanka's Ceylon Petroleum Corp (Ceypetco) is offering 110,000 barrels of naphtha for Aug. 2-3 loading from Colombo. The tender closes on July 6 and will remain valid for two days.

Egyptian General Petroleum Corporation was offering three separate cargoes of naphtha for loading over July 8-10, Aug. 9-11 and Sept. 9-11, a broker source said.

Temasek-backed Singapore conglomerate Keppel Corp and Sembcorp Marine are set to begin talks to explore combining their ailing offshore and marine (O&M) businesses, two sources familiar with the matter said on Thursday.

Oil prices gained for a second day on Thursday after drawdowns in US inventories and accelerating German economic activity bolstered confidence in the fuel demand recovery.