Guess what percentage of companies actually reward staff for innovation…August 31, 2015 3:16
French strike lifts gasoline, naphtha premiums
Unplanned KPC outage lifts gas oil premiums.
October 21, 2010 12:43 by Reuters
Gasoline and naphtha premiums in the Middle East climbed this week after cargoes were diverted to Europe, where a widespread refinery and port strike in France has dried up supplies in the region, traders said.
“The strike came along the same time when most European refineries are shut for maintenance,” said one gasoline trader. “Cracks are coming up big time.”
Nationwide strikes over pension reforms have spread to France’s 12 oil refineries, adding to the impact of a multi-week strike at the country’s largest oil port, Fos-Lavera.
Another trader pegged gasoline at around Middle East benchmark naphtha quotes plus $70-80. That compares with last week’s $60 to mid-high $80s.
The first trader said some prompt demand from Oman and the expectation Saudi Aramco would enter the market in November had offered further support. “We’re still expecting the Saudis to come up…with 2-3 cargoes of demand in November,” he said.
Gasoline’s relative strength also reflected rising premiums in the naphtha market, which recovered this week as more Middle Eastern cargoes headed West following the French port and refinery strike.
“Naphtha is very strong now,” a third trader said, adding that excess supplies have been wiped out by refinery maintenance shutdowns.
Saudi Aramco sold 50,000 tonnes of A180 naphtha for early-November loading from Ras Tanura at $16.00-$17.00 a tonne above Middle East quotes, free-on-board (FOB) basis, pointing to a strong recovery on the export market to high premiums, traders said on Monday.
Two other Saudi cargoes were shipped to Europe last week by Vitol, traders said.
Moves from the Middle East or Asia to Europe are rare because these regions are short of the petrochemical feedstock naphtha.
India’s November naphtha exports are expected to fall to around 700,000-750,000 tonnes because of refinery maintenance, versus about 820,000 tonnes this month, traders said on Wednesday.
Kuwait Petroleum Corp (KPC) had sold some 74,000 tonnes of November naphtha last week but traders said it might limit spot sales next month after it successfully termed up most of its 1.1 million tonnes for December 2010-November 2011.
Traders continued to monitor Iran, once a major gasoline buyer whose regular suppliers have been deterred by international sanctions.
“We’re not seeing any product imports from them,” the third gasoline trader said. “No diesel or gasoline — but they must be buying, particularly from the Chinese. I think they’re doing a very good job keeping it under the radar,” he said.
Plentiful supplies have weighed on gas oil premiums and the outlook was bearish for the near-term, traders said.
“There’s no extra demand from the usual buyers like Qatar or Saudi, while there’s a lot of supply,” one distillates trader said. “But some refinery hiccoughs in Kuwait are putting some pressure on the nearby market,” he added.
He said a hydrocracker failure at Mina Al-Ahmedi refinery at Kuwait Petroleum Company (KPC) caused a delay in shipments as it was running at very low capacity.
KPC was not available for comment.
The trader said regional premiums for 0.2 percent gas oil were pegged around $0.40-0.50 a barrel, 0.5 percent at $0.30-40 a barrel. That compares with 0.2 percent gas oil at about $0.70-$0.80 a barrel and 0.5 percent gas oil at $0.30-60 a barrel last week.
Exports from Saudi Arabia have risen since the kingdom has emerged from its peak summer demand period, adding to bearish sentiment in Asia and in the Middle East.
In this week’s tender Saudi Aramco sold 90,000 tonnes of November-loading A961 low-density fuel oil at a four-month high price due to a recovery in demand from post-flood Pakistan, traders said on Thursday.
However, traders said the upside is limited by fuel oil exports from the kingdom, which hit four-month high volumes of at least 600,000-650,000 tonnes for October.
“The market’s still flooded by fuel oil,” one trader said. “There’s not enough demand and too much excess material. The bunker market is almost non-existent.”
He declined to give an exact range for Fujairah bunker prices for 180 centistoke (cst) but he said they were way below the $4 to $7 a tonne above Middle East spot quotes, pegged two weeks ago.
(Editing by Barbara Lewis)