- Steaper contango on day- East has a strong weekly arb



As of December 5, the European naphtha
market had an even steeper contango structure. The December/January
spread fell $1.25-2.50/mt for the third consecutive day. It was assessed at
$2.75-3.85/mt. Sources say that European
demand was slow due to a sharp decline in blending activity, and a weak
petrochemical industry. In spite of
relatively large East-West spreads, arbitrage to East of Suez via the
Mediterranean remained open. According to
Kpler shipping data, the forecast for Dec. 5 is 263,000 mt versus 64,000 for
the previous week. The December/January
price was $19.75-24.85/mt. This is 25 cents/mt more than the previous day. However, Asia's demand remained low, particularly due to the
South Korean truckers strike, which was the second this year. Sources said that there was an increase in inventories...