Asia’s naphtha margins fell for a third consecutive session on Monday, with the crack spread dropping by $6.40 to $87.05 per metric ton above Brent crude, down from $93.45 on Friday.

The backwardation between first-half October and first-half November also narrowed to $6 per ton. While demand is anticipated to strengthen with the restart of several ethylene crackers in Asia, supply constraints are moderating expectations. Ongoing and upcoming cracker shutdowns for maintenance are tempering the market outlook, according to an LSEG report.

In the gasoline market, the margins rose to $5.65 per barrel over Brent crude, from $5.46 on Friday.

NEWS

Oil prices rose 1% on Monday on renewed concerns that an escalating Gaza conflict could disrupt regional oil supplies, further bolstered by the prospect of U.S. interest rate cuts. Brent crude futures LCOc1 climbed 79 cents to $79.81 a barrel, while U.S. crude futures CLc1 were at $75.63 a barrel, up 80 cents.

Russia has increased fuel oil exports to around 1.1 million barrels per day (bpd) in August, up from 900,000 (bpd) for July, after completing maintenance at some oil refineries. The main importers of Russian fuel oil were China, India and Saudi Arabia.

China’s Sinopec, the world’s largest oil refiner by capacity, said its oil and gas production hit a record high of 257.66 million barrels of oil equivalent, up 3.1% on the year, led by rising natural gas production. It posted a 2.6% rise in net profit for the first half of the year as record oil and gas output compensated for falling domestic demand for refined fuel and petrochemicals.
Source: Reuters (Reporting by Haridas; Editing by Devika Syamnath)