MUMBAI (Commoditiescontrol) – Crude oil prices rose slightly on weekend on futures buying and ending the week higher, but gains were limited by a strong US dollar and lingering doubts whether OPEC producers would stick to a deal to cut output. Meanwhile, the dollar also gained broadly after the US non-farm payrolls report showed slower hiring in December but an increase in wages, feeding expectations of further interest rate increases from the Federal Reserve this year. A stronger greenback makes oil more expensive for holders of other currencies.
Ethylene and paraxylene
The gap between North East and South East ethylene narrowed down this week with the former falling on bearish sentiment on deepsea cargoes and latter rising ahead of steam cracker turnaround. Northeast CFR markers declined US$20 on the week to US$1,109-1,111 a ton while Southeast CFR gained US$25 at US$1,004-1,006 a ton. In US, spot fell after reaching a 2-month high early in the week while Formosa begins planned turnaround at Texas cracker. Spot was assessed at US cents 30.63-31.13 per pound USG FD USG for prompt-month material, edging down US cents 0.37 on the week. European ethylene spot climbed amid marginal tightening of material as producers built inventory ahead of maintenance. Spot was at Euro886-890 a ton FD, up Euro23 on the week while CIF values were at US$929-934 a ton, up US$28.
Paraxylene prices in Asian markets inched up US$3.67 on the week with CFR Taiwan/China closing at US872.17-873.17 a ton and FOB Korea at US$852.17-853.17 a ton. Prices had fallen opening the week but recovered by the end as naphtha bounced on Thursday. US paraxylene spot was up US$15 week on week, assessed at US$815 a ton FOB USG following Asian cues but hovered at Asia netback. European paraxylene fundamentals were firm as supply-demand mismatch took its grip. Spot gained US$7 on the week to US$782 a ton.
MEG and PTA
MEG markets were bullish after thin trading seen earlier in the week as supply tended to tighten on the back of sustained fall in inventories at ports and the moderate import volume. Prices gained US$16 week on week, with CFR China at US$913-918 a ton while CFR South East Asia marker was up at US$915-917 a ton. During the week, MEGlobal nominated its February MEG Asian contract price at US$1,060 a ton, US$40 higher from its January nomination. In US, MEG spot rose to a fresh 17-month high at US cents 38.50-39.50 per pound FOB USG as export availability thinned and interest was in sending cargoes to Asia. European MEG spot climbed Euro40 on the week to Euro850 a ton FCA NWE amid limited availability as Asia drew Middle East material.
PTA markets sentiment in Asia were bullish ahead of Lunar New Year and are expected to hold steady in January amid stable-to-firm demand from China and India, unlike in previous years when the Lunar New Year period had translated to weaker sentiments. Prices gained US$3 on the week with CFR China at US$644-646 a ton while CFR Southeast Asia marker was assessed at US$651-653 a ton amid talks of tightening supply while feedstock paraxylene rose week on week. In Europe, PTA January net contract price was assessed at Euro680 a ton, up Euro40 on the week, largely tracking the firmer initial settlement of the January paraxylene, which increased on the month. In US, PTA awaited January settlement since feedstock have risen since holidays.
(By Commoditiescontrol Bureau; +91-22-40015522)
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