Asia's naphtha crack recovered from a one-week low to touch a three-session high of $83.05 a tonne on Thursday, supported by demand and lower volumes of cargo arriving this month from the West compared to January and February. Demand from South Korea remained comparatively firm, with Hanwha Total and YNCC coming forward to buy cargoes of different grades.
YNCC paid some $4.50 to $5.00 a tonne premium to Japan quotes on a cost-and-freight (C&F) basis for at least 75,000 tonnes of open-specification grade naphtha for second-half April arrival at Yeosu, traders said. This was at least three times higher than the $1.50 a tonne premium YNCC paid on Feb. 20 for cargoes scheduled for first-half April delivery.
Hanwha Total paid about $10.50 a tonne for heavier grade naphtha to be also delivered in second-half April but to Daesan, they added. Hanwha Total bought a similar grade just two days ago for second-half April delivery at a lower premium of about $8. Malaysia-based Titan joined the string of South Korean buyers this week and locked in naphtha for second-half April delivery to Pasir Gudang at premiums in the range of low to mid-single digit levels to Japan quotes on a C&F basis.
This sharply contrasted with the discount level Titan paid in end-February for first-half April fuel. Asia's gasoline crack fell for a sixth straight session to reach $7.74 a barrel on Thursday, lowest since Feb. 26 as ample supply weighed.
Singapore onshore light distillates stocks, which comprise mostly gasoline and blending components for the fuel for instance, jumped 12 percent, or 1.54 million barrels, to reach a three-month high of 14.58 million barrels in the week to March 7. This was just 6.2 percent shy of the record high volume in March 2016 at 15.54 million barrels, when gasoline was temporarily stored on ships due to oversupply.