Asia Naphtha/Gasoline-Naphtha cracks at two-month high

SINGAPORE, Dec 12 (Reuters) - Asia's naphtha market
continued to gain momentum on Monday with cracks reaching a
two-month high on Korean demand.
The January refining margin, at a discount of $7.88 a
barrel, is the highest front-month crack to Brent crude since
Oct. 6, Reuters data showed.
Low inventory levels have prompted South Korean buyers to
purchase January cargoes, supporting the naphtha market, trading
sources said.
"The demand is strong when compared to last month as their
inventory levels are low. So they have to buy to build up the
inventory to normal levels," he said.
South Korea's Honam Petrochemical issued a tender on Monday
seeking unspecified volumes of open-specification naphtha for
second half of January delivery, a second source said.
Meanwhile, China's West Pacific Petrochemical Corp (WEPEC)
offered a second naphtha cargo for January through a
spot tender, traders said. The refiner offered 28,000-30,000
tonnes for Jan. 12-14 in a tender due to be awarded later on
Monday. But no details were available at the time of
publication.
In tenders, India's Oil & Natural Gas Corp Ltd (ONGC) and
Bharat Petroleum Corp (BPCL) is offering a total of 105,000
tonnes of naphtha for January loading.
ONGC is offering 35,000 tonnes for loading from Hazira over
Jan. 13-14 in a tender that closes on Dec. 16.
BPCL is 35,000 tonnes for loading from Mumbai over Jan.
13-15 and 35,000 tonnes for loading from Kochi over Jan. 18-22.
Both tenders close on Dec. 13 and are valid until Dec. 14.
BPCL also sold 70,00 tonnes of naphtha in total for loading
from Mumbai and Kochi over Jan. 5-7 and Jan. 3-7 to Totsa at
premiums of $14 and $17 a tonne over Middle East quotes
respectively, trading sources said.

* SWAPS OUTRIGHTS (CFR Japan): December 2011 and January
2012 swaps were at $903.00 and $900.00 a tonne respectively, up
$15.

* SWAPS CRACKS : Discounts on crack spreads
for January narrowed $1.21 to $7.88 a barrel to Brent crude.

* EAST-WEST SPREADS (The differential between CFR Japan
swaps and Northwest Europe swaps): Asia's December swaps were
$20.25 higher than Northwest European prices.

* JAPAN OPEN-SPEC NAPHTHA NAF-1H-TYO: The price for
front-month second-half January rose $13.50 to $905.00 a tonne.

* BACKWARDATION/CONTANGO: The intermonth spread premiums
between second-half January and second-half February were at
$5.50 a tonne.

* CRACK SPREAD NAF-SIN-CRK: Cracks for first-half January

- the profits or losses of refining Brent crude into naphtha -

gained $10.05 to $95.90 a tonne.

* NAPHTHA CASH DEALS: One deal
- Mabanaft sold 25,000 tonnes of naphtha for first half
February to Shell at $902 a tonne.

* REFORMING MARGINS: Gasoline's premium to naphtha
GL92-SIN-DIF rose 35 cents to $13.11 a barrel.

* GASOLINE CRACKS GL92-SIN-CRK: Cracks - premiums/losses
obtained from refining Brent crude into gasoline - was at a
$3.37 premium.

* GASOLINE CASH DEAL: one deal
- BP sold 50,000 barrels of 95-octane gasoline for loading
over Dec. 27-31 to Glencore at $113.50 a barrel.

(Reporting by Jessica Jaganathan; Editing by Alison Birrane)