Asia’s second-half August naphtha price climbed back above $700 per ton on Thursday in tandem with a rise in crude oil benchmarks, and the backwardation further narrowed to $6 a ton.

The refining profit margin for naphtha stood at $63.78 per ton over Brent crude, compared with $64.78 a day earlier.

South Korean naphtha buyers were active this week, with GS Caltex seeking a cargo for August and YNCC and LG Chem seeking supplies of the light distillate for September, market sources said. Another buyer Hanwha TotalEnergies also emerged for buying 25,000 tons of naphtha, they added.

In gasoline markets, energy trader Aramco snapped up 150,000 barrels of benchmark grade of motor fuel at the window. The margin for gasoline was range-bound with limited downside due to healthy demand and big inventory draws across trading hubs.

INVENTORIES

Singapore light distillate stocks dropped by 2.202 million barrels to the lowest level since Feb. 14 at 13.307 million barrels in the week to July 10, Enterprise Singapore data showed. However, the inventories were nearly at the same level at this time in 2023.

U.S. gasoline stocks USOILG=ECI fell by 2 million barrels in the week to 229.67 million barrels, the U.S. Energy Information Administration said, compared with analysts’ expectations in a Reuters poll for a 0.6 million-barrel drop.​

NEWS

– Oil prices gained on Thursday as crude stocks fell after U.S. refineries ramped up processing and as gasoline inventories eased, signalling stronger demand.

– Global oil demand growth will slow to just under a million barrels per day (bpd) this year and next, the International Energy Agency (IEA) said, as Chinese consumption contracted in the second quarter amid economic woes.

SINGAPORE CASH DEALS O/AS

Four gasoline deals, no naphtha trades.
Source: Reuters (Reporting by Mohi Narayan; Editing by Susan Fenton)