Asia's naphtha crack price rose to a December high of $66.88 a tonne while the contango between second-half January and second-half February remained at $1.50 a tonne for a second day, reflecting a slightly improved near-term outlook. Traders said improving Asian demand for naphtha for delivery in the second half of January could help clear some of the excess arbitrage supplies accumulated in December and arriving in January.
On Tuesday the price contango between second-half January and second-half February was $2.25 a tonne. A market in contango typically reflects ample inventories, where the price for immediate delivery trades below future prices. But traders said the upside to clearing excess stocks could be limited as Indian supplies continued to flow steadily.
Singapore's light distillates stocks, which comprise mostly gasoline and blending components for the transport fuel, fell by 106,000 barrels to a three-week low of 11.98 million barrels in the week to December 14, official data showed. The current levels were just 1 percent down from the previous week, but 7.2 percent lower than a year ago. Thailand's integrated oil refiner IRPC Pcl plans to invest 10 billion baht ($280 million) next year with the aim to expand its production capacity of a petrochemical product and boost its long-term earnings growth, a top executive said.