Asia’s refining profit margin for naphtha declined on Monday as China’s disappointing economic data dented hopes of demand recovery in the global hub of petrochemicals.

The crack dropped by $9.13 to minus $13.35 a metric ton over Brent crude. The first-half September naphtha price traded $1.25 higher than the following month in backwardation structure.

China’s gross domestic product (GDP) grew 6.3% year on year in the second quarter, compared with analyst forecasts of 7.3%, with its post-pandemic recovery faltering rapidly.

At the deals window, there were no trades for naphtha, while 200,000 barrels of gasoline of grades 92-octane and 95-octane changed hands.

The gasoline crack jumped to $15.27 a barrel over Brent, compared with $13.02 on Friday on firm demand.

Gasoline demand in Asia, excluding China, is set to average 100,000 barrels per day (bpd) higher year-on-year at 4.1 million bpd in August and September, according to estimates by energy consultancy FGE.

“Peak summer driving demand in Japan and South Korea will provide support to regional demand when India’s demand falls during peak monsoon season in July and August,” analysts at FGE said in a note.

REFINERY NEWS

South Korean refiner Hyundai Oilbank will shut the No. 2 crude distillation unit (CDU) and some downstream derivative production units at its Seosan refinery around mid-August for planned maintenance, four sources familiar with the matter said.

Maintenance work on the 360,000-barrel per day (bpd) CDU will be done from Aug. 10 to Sept. 18, one of the sources said.
Source: Reuters (Reporting by Mohi Narayan; Editing by Nivedita Bhattacharjee)