Bapco sells 100,000 T naphtha
Manama, May 2, 2011
State-owned Bahrain Petroleum Company (Bapco) has sold two 50,000 tonne cargoes of naphtha for June loading, trade sources said on Monday, in one of its biggest sales since the refinery underwent a major turnaround in February.
The company has been in the market since last week and has now completed the sales, four trading sources said.
One industry source said Japanese trader Marubeni was the buyer for at least one cargo but this could not be confirmed by other traders.
'We will probably see more sales from Bapco in the coming weeks as the refinery is back to normal now,' one trader said.
One source said the premiums for both cargoes were at $27 a tonne to Middle East quotes on free-on-board (FOB) basis.
'There's only one home for this type of cargoes and that is Asia petrochemicals sector,' one trader said, adding that the price was broadly in line with the market. 'That number doesn't surprise me at all.' But another said it was expensive.
'FOB premiums are out of control. They are disconnected from cracker or blending margins,' he said.
In Asia, the naphtha crack rose to its highest in nearly four months on Friday while the front-month backwardation widened a dollar.
'Marubeni is quite active in the Indian and Middle Eastern naphtha market,' one trader said. 'Also, they might have been caught short in which case any price makes sense,' he said.
The March 11 earthquake disrupted production across Japan's petrochemical sector, which is slowly restoring production. The country depends heavily on naphtha imports.
Output at Bapco fell to 190,000 barrels per day from a full capacity of 260,000 bpd during the outage, which the chief executive of the company described in March as the biggest in the firm's history.
Traders had said the output was also affected by the unrest in the Gulf country during March.
One industry source said he expected jet fuel sales from Bapco in June. Bapco officials were not available for comment.-Reuters
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