Asian ethylene-naphtha spread falls from 7 year highs
Spot naphtha prices in Asia are largely unchanged week over week, but are currently down by $120/ton compared to the levels reported in mid-June of this year.
For ethylene, spot prices have plunged by over $100/ton compared to last week, weighed down by volatile crude prices and high inventories. Compared with the levels reported in mid-June, spot ethylene prices in the region suggest an even larger drop of around $470/ton.
Due to the sharper fall in ethylene prices, the spread between Asian ethylene and naphtha prices has declined to around $500/ton from this year’s peak of over $800/ton.
Oversupply for ethylene is unlikely to ease in the short term as no production issues are reported in the region for now and many crackers are reportedly running at full rates on the back of improved margins owing to lower naphtha costs.
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