HPCL cancels 90KT naphtha tender for Aug-Nov

By Staff
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Google Oneindia News

SINGAPORE, Aug 4 (Reuters) Hindustan Petroleum Corp. Ltd. (HPCL) has cancelled a tender which offered three 30,000-tonne naphtha cargoes for August to November loadings, due to low prices, trading sources said on Friday.

''HPCL was not happy with the bid numbers,'' a company trading source said, without elaborating.

Asia's naphtha market has weakened sharply in the past month on record-high Indian exports, higher term and spot sales from Middle Eastern refiners, high inventories in Japan and weak regional demand due to cracker shutdowns from August through November, traders say.

Naphtha's premium to Brent crude -- the Brent/naphtha crack -- has slumped by nearly a third over the past month, with the time spread quoted at a deep contango.

Loadings for the three cargoes -- a mixture of heavy, high aromatic and low aromatic naphtha -- had been respectively set for Aug. 25-28, Oct. 5-10 and Nov. 7-10, all from Mumbai on a free-on-board basis.

The Indian refiner awarded a tender in May to export three 30,000-tonne naphtha lots for July-September loading from Vizag at a premium of more than a tonne to Middle East quotes, on a free-on-board (FOB) basis.

Naphtha is the feedstock used to produce ethylene and propylene, the basic building blocks for the chemical sector.

REUTERS CS PM1341

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