Asia's gasoline crack hit a 22-month high of $16.16 a barrel on Friday as solid demand driven by refinery maintenance and the upcoming Muslim fasting month kept a bull-run going, traders said. Buyer Indian Oil Corp (IOC) returned to the market for at least the fifth time, this time seeking up to 74,000 tonnes for June delivery in a tender closing on May 19.
IOC is not a regular gasoline importer. Excluding the new tender, IOC has since February bought more than 230,000 tonnes of gasoline for March to May delivery. "There's supply tightness in the East due to India and Indonesia demand," a trader said. Indonesia, Asia's top gasoline importer, is seeking up to 4.8 million barrels of gasoline for third-quarter delivery.
Asia's naphtha crack hit a two-week high of $98.08 a tonne but it was still 13 percent lower from a month ago as supplies were building up on reduced demand. Cracker maintenance in Japan, South Korea and Taiwan will cut naphtha demand while an influx of cheaper alternative liquefied petroleum gas (LPG) coming in next month will replace 200,000 tonnes of naphtha in the petrochemical sector. Abu Dhabi National Oil Co (ADNOC) has offered two grades of low-sulphur naphtha for the first time following the expansion of its Ruwais refinery.
Offers for low-sulphur naphtha from its new refining units were pegged at $16 a tonne premium to its own price formula on a FOB basis. The existing stream from its older refining units were at $18 a tonne premium. Its two other existing grades of pentane and splitter naphtha were offered at premiums of $21 and $17 a tonne.
Mangalore Refinery Petrochemicals Ltd (MRPL) for instance sold 55,000 tonnes of naphtha to Japanese Petro-Diamond for June 27-29 loading from New Mangalore at a premium of about $21 a tonne to Middle East quotes on a free-on-board (FOB) basis. Bharat Petroleum Corp Ltd (BPCL) sold a 35,000-tonne cargo for June 1-5 loading from Kochi to Marubeni at premiums of about $25 a tonne to Middle East quotes on a FOB basis. It had also sold 30,000 tonnes for June 16-18 loading from Mumbai to Itochu at premiums of $18 to $19 a tonne.