Asia’s naphtha markets weakened on Tuesday as worries over new supplies from the Middle East offset some of the fears of supply disruptions via the Red sea, market players said.

The crack fell by about $6 to $103.58 per metric ton over Brent crude. The first-half March naphtha price slipped by $6 to $690 per ton in backwardation structure.

During the weekend, the Dangote Group announced that its 500 kb/d refinery in Nigeria had begun production of diesel and aviation fuel.

“The naphtha and residue produced in this phase will likely be exported due to the lack of domestic demand,” analysts at consultancy FGE said in a note. A bulk of those exports are expected to reach Asia, market players said.

In gasoline markets, the crack treaded steady above $10 per barrel on Tuesday.

NEWS

– Chinese refiners are actively booking crude oil cargoes for delivery in March and April to replenish stocks, locking-in relatively low prices and in anticipation of stronger demand in the second half of 2024, trade sources said.

– Japan’s Nippon Yusen, the country’s biggest shipper by sales, on Tuesday suspended navigation through the Red Sea for all the vessels it operates, a spokesperson told Reuters.

SINGAPORE CASH DEALS O/AS

One naphtha trade, no gasoline deals.
Source: Reuters (Reporting by Mohi Narayan; Editing by Sonia Cheema)