Asia’s naphtha refining profit margin was steady on Thursday amid tepid window activity, but the price for second-half May cargo jumped by about $25 to $549 per metric ton mirroring the rise in crude oil benchmark.
The crack traded at about $70 per ton over Brent crude. The backwardation between second-half May and second-half June naphtha prices remained volatile and narrowed again to $5.75 a ton.
In refinery news, Taiwan’s Formosa Petrochemical is currently running two of its three naphtha crackers at a combined rate of 60%, while its No. 2 cracker has remained offline for more than a year due to weak demand, a company spokesperson said.
To supplement feedstock needs, the company purchased liquefied petroleum gas cargoes for the second half of May, according to trade sources.
“We have bought the cargoes as we plan to switch to LPG feed in May, but we will not increase operating rates as demand is lower,” the spokesperson said.
INVENTORIES
Singapore’s light distillate stocks rose by 275,000 barrels to a two-week high of 15.97 million barrels in the week to April 9, Enterprise Singapore data showed.
Gasoline stocks (USOILG=ECI) fell by 1.6 million barrels in the week to 236 million barrels in the week to April 4, the EIA said, compared with expectations for a 1.5 million-barrel draw.
NEWS
– Oil prices retreated nearly 3% on Thursday as fears of a deepening U.S.-China trade war and possible recession eclipsed earlier relief created by President Donald Trump’s announced 90-day pause on sweeping tariffs against most countries.
– U.S. President Donald Trump’s sudden decision to pause most of the hefty duties he had just imposed on dozens of countries brought relief to battered global markets and anxious European leaders, even as he ratcheted up a trade war with China.
– U.S. refiners are not planning to make big-ticket investments to process more domestic crude and less oil from top suppliers Canada and Mexico, industry sources and analysts said, an obstacle to President Trump’s plan to boost oil output.
SINGAPORE CASH DEALS
No trades.
Source: Reuters