Naphtha stocks fell substantially due to strong petrochemical demand and blending into gasoline for export, PJK said. Exports to the United States were limited due to rising stocks in the country and seasonally low consumption. The Middle East and Asia are pulling in considerable amounts of gasoline and reformate in advance of heavy refinery maintenance early next year.
More than 500,000 tonnes have already sailed east this month from Europe, with close to 200,000 tonnes more set to load over the coming week. China will raise its gasoline prices by 265 yuan ($39.96) per tonne and diesel by 250 yuan per tonne from Friday. Chinese oil refiners are also churning out record amounts of fuel in the last quarter of 2017, looking to cash in on the best refining profits in nearly two years after a rally in diesel and gasoline prices.
Demand for western naphtha in Asia is also expected to remain elevated, analysts at AlphaTanker said, as colder winter weather keeps LPG prices high and thus naphtha petrochemical cracking margins high. There were no trades of Eurobob gasoline in the afternoon trading window. Some 12,000 tonnes traded in the morning between $598 and $605 a tonne fob Amsterdam-Rotterdam, and another 2,000 tonnes traded at $588 a tonne in the afternoon. This compared with trades from $600 to $612 a tonne on Wednesday.
Shell, BP and Statoil sold to Gunvor, while Gunvor also sold a cargo to Varo. No barges of premium unleaded gasoline traded. Offers came in at $594 a tonne, but there were no bids. This compared with trades at $608 and $617 a tonne the previous day. The December swap stood at $579.50 a tonne at the close, down from $584.50 a tonne on Wednesday. The benchmark EBOB gasoline refining margin declined to $9.27 a barrel from $11.81 a barrel. Brent crude futures were down 59 cents to $61.28 a barrel at 1705 GMT.
Copyright Reuters, 2017