For the Quarter Ending December 2024
North America
In Q4 2024, the North American naphtha market experienced a quarter-on-quarter decline of 5.9%, driven by weakened demand across key downstream sectors and fluctuating supply dynamics. The petrochemical sector saw reduced demand for naphtha as feedstock due to planned maintenance at ethylene crackers and lower production rates.
Fuel applications also declined, with light distillate demand softening as gasoline inventories rose and distillate fuel production fluctuated. Seasonal factors, such as milder-than-expected winter weather, limited heating fuel demand, further contributing to the downward trend. Economic uncertainties, including geopolitical tensions and shifts in global trade dynamics, weighed on market sentiment, while stable crude oil inventories kept supply levels sufficient throughout the quarter.
Despite a slight uptick in demand toward the end of the quarter driven by colder temperatures, the overall market remained bearish due to surplus inventories and limited downstream activity. The delayed production adjustments by OPEC+ and easing geopolitical tensions impacted upstream costs but failed to offset the broader demand-supply imbalance. The market remained volatile, reflecting complex dynamics across the manufacturing, petrochemical, and fuel production sectors.
APAC
In Q4 of 2024, the APAC market witnessed bearish trend especially in countries like Japan. The Japanese naphtha market in Q4 2024 experienced a quarter-on-quarter decline of 2.3%, driven by weak demand and ample supply. Prices were stable at the beginning of October due to balanced supply-demand dynamics and steady domestic margins, despite subdued manufacturing activity. Mid-quarter, prices fluctuated with changes in crude oil costs, rising briefly before declining as demand from the petrochemical sector weakened and cracker turnarounds reduced consumption. November saw consistent price drops due to oversupply and reduced demand, particularly from the olefin and plastics sectors. Import volumes into Asia, including Japan, declined for the second consecutive month, further pressuring prices. Toward December, prices showed modest recovery, supported by a decline in Middle Eastern stockpiles and anticipation of improved demand in early 2025. However, overall fundamentals remained weak, with low consumption in the downstream petrochemical sector and oversupply persisting in the market. Currency appreciation against the USD slightly offset import cost pressures. Despite a late-quarter recovery, the market ended on a bearish note, reflecting challenges in regional and global naphtha demand.
Europe
In Q4 2024, the European naphtha market especially in Germany experienced a quarter-on-quarter decline of 4.8%, reflecting subdued demand across key downstream sectors amid challenging economic conditions and volatile global market dynamics. The petrochemical industry faced weak demand due to ongoing maintenance at major crackers and economic stagnation, leading to reduced consumption of naphtha. Additionally, seasonal factors, including mild weather conditions, limited the need for heating fuel, further dampening demand for naphtha in the region. On the supply side, stable gas supplies in Europe reduced reliance on naphtha for energy production. Increased gasoline inventories and subdued refining activity also contributed to the bearish market sentiment. While the easing of cracker maintenance and improved transatlantic gasoline exports offered some support, the overall market remained under pressure from weak regional industrial activity and geopolitical uncertainties.
Geopolitical tensions and ongoing economic uncertainties continued to weigh on market sentiment. Rising crude oil prices, driven by supply concerns, had limited impact on naphtha prices due to a lack of downstream demand. The European market remained volatile, reflecting the complex interplay of supply-demand dynamics, economic stagnation, and the region’s shift toward cleaner energy alternatives.
South America
In Q4 2024, the South American naphtha market faced challenges marked by a 4.7% quarter-on-quarter decline. Demand remained weak due to sluggish performance in the petrochemical and fuel sectors, which are the primary consumers of naphtha. High inventory levels and increased refining capacity contributed to oversupply in the market. While geopolitical tensions led to fluctuations in crude oil prices, these were partly offset by eased tensions towards the quarter’s end. The region’s petrochemical sector struggled with declining global demand, limiting naphtha consumption. The fuel production sector showed mixed results, with moderate gasoline blending demand in December but overall weak fuel consumption. A stronger US Dollar and OPEC+ production delays further pressured market conditions. Despite minor improvements in Asian demand towards the quarter’s end, the outlook remains bearish. The South American market is expected to continue facing supply-demand imbalances and global economic uncertainties, with any substantial recovery contingent on global economic revival and a boost in downstream petrochemical activities.
MEA
In Q4 2024, the Middle East and Africa (MEA) naphtha market experienced a quarter-on-quarter decline of 3.5%. The market was influenced by several factors, including weak demand from the petrochemical sector, and slowing fuel consumption. Geopolitical tensions, particularly in the Middle East, created volatility in crude oil prices, but despite this, naphtha prices continued to decline due to oversupply and lower demand. Maintenance at key refineries, including the Fujirah refinery, further complicated supply-demand dynamics, with delayed production resumption contributing to increased stock levels. Additionally, the slowdown in global petrochemical demand, particularly from key consumers in Asia and Europe, put additional pressure on naphtha prices. While some stability was seen towards the end of the quarter, market sentiment remained largely bearish due to global economic uncertainty, OPEC+ production cuts, and low demand from major importers such as China. The market outlook for naphtha remained cautious, with reduced consumption across key sectors and limited growth opportunities in the short term. Overall the market remained bearish in Q4 2024 in MEA region.
For the Quarter Ending September 2024
North America
Throughout Q3 2024, Naphtha pricing in North America witnessed a persistent decline, with significant factors contributing to this trend. The market was heavily influenced by a combination of reduced demand, oversupply, and weakening global economic conditions. Decreased industrial activity, particularly in downstream sectors, led to a slump in demand for Naphtha, exacerbating the surplus in the market. Additionally, the ongoing geopolitical uncertainties and trade tensions further dampened market sentiment, pushing prices downward.
In the USA, where the most substantial price changes were observed, the Naphtha market mirrored the overall regional trend. The correlation between Naphtha prices and international crude oil markets remained strong, with pricing dynamics closely following crude oil fluctuations. The -21% decrease from the same quarter last year highlighted the significant price erosion over time, compounded by the -3% decline from the previous quarter in 2024. The comparison between the first and second half of the quarter, showing a -3% decrease, further emphasized the continued downward trajectory.
The latest quarter-ending price of USD 552/MT of Naphtha FOB Texas in the USA underscored the prevailing negative pricing environment, reflecting a challenging period for Naphtha markets in North America.
APAC
In Q3 2024, the Naphtha market in the APAC region experienced a significant decline in prices. Several factors influenced this downward trend, including decreased demand from downstream sectors, oversupply of Naphtha, and weak macroeconomic conditions. The bearish market sentiment was exacerbated by low refining margins, geopolitical tensions impacting crude oil prices, and reduced production rates in the petrochemical industry.
Japan, in particular, witnessed the most notable price changes during this quarter. Overall trends in Japan reflected the regional context, with a consistent decrease in Naphtha prices. Seasonality and correlation in price changes highlighted a clear downward trajectory, with a -8% change from the same quarter last year and a -3% change from the previous quarter in 2024. The comparison between the first and second half of the quarter showed a substantial -4% decrease. The quarter-ending price of USD 650/MT of Naphtha CFR Tokyo in Japan marked the culmination of this negative pricing environment, illustrating a challenging period for the Naphtha market in the region.
Europe
In Q3 2024, the Naphtha market in Europe experienced a notable decline in prices, with the Netherlands being the most impacted. Several factors contributed to this downward trend. Firstly, oversupply in the market due to increased production and reduced demand from the petrochemical sector led to pricing pressures. Additionally, weakening global economic conditions and decreased refining margins further pushed prices downwards. The seasonal shift towards lower energy demand also played a role in the declining prices. Comparing to the same quarter last year, prices saw a significant decrease of 17%, indicating a prolonged downward trajectory. Furthermore, the quarter-on-quarter change in 2024 showed a 3% decline, reflecting the ongoing negative trend. The second half of the quarter saw a more pronounced decrease of 7% compared to the first half, emphasizing the intensification of price declines.Ultimately, the quarter concluded with Naphtha prices at USD 545/MT FOB Rotterdam in the Netherlands, underscoring the prevailing negative pricing environment characterized by consistent decreases throughout the period.
MEA
The third quarter of 2024 witnessed a consistent decline in Naphtha prices across the MEA region, with notable impacts on the market dynamics. The significant factors influencing this downward trend included an oversupply of crude oil, subdued demand from key importing regions, and geopolitical uncertainties affecting supply chains. These factors collectively contributed to a bearish sentiment in the Naphtha market, leading to decreased prices. In Saudi Arabia specifically, the market experienced the most significant price changes during this period. The overall trend displayed a negative correlation, with prices declining by 9% compared to the same quarter last year. However, the quarter-on-quarter change remained relatively stable at 0%, indicating a temporary stabilization amidst the overall downward trajectory. Furthermore, the price comparison between the first and second half of the quarter revealed a 3% decrease, reflecting a sustained decline in Naphtha prices. Ultimately, the quarter concluded with Naphtha prices in Saudi Arabia standing at USD 593/MT FOB Jeddah, underscoring the prevailing decreasing sentiment in the market.
South America
In Q3 2024, the Naphtha pricing in South America witnessed a significant decline, reflecting a negative market sentiment. This quarter has been characterized by a multitude of influential factors contributing to the downward trend in prices. The 29% decrease from the same quarter last year can be attributed to weakened demand from downstream industries and oversupply in the market. The 4% decrease from the previous quarter in 2024 was mainly driven by reduced refining margins and decreased buying interest amid the weak market situation. Brazil, experiencing the most substantial price changes, saw a correlation in price fluctuations, with a notable -3% difference between the first and second half of the quarter. This trend aligns with the overall negative sentiment in the market. The latest quarter-ending price of USD 520/MT of Naphtha EXW-Rio de Janeiro in Brazil signifies the continued downward trajectory in pricing. The seasonality and correlation in price changes underscore a challenging pricing environment, marked by stability at lower price levels.
For the Quarter Ending June 2024
North America
In Q2 2024, the North American naphtha market experienced a pronounced downward trajectory in prices, driven by several significant factors. The quarter saw a consistent decrease in naphtha prices due to high supply volumes, subdued demand from downstream petrochemical sectors, and easing crude oil prices. The ample supply of naphtha, largely influenced by increased output from key global producers, created a glut in the market, putting downward pressure on prices. Additionally, the petrochemical industry's sluggish demand, exacerbated by high inflation rates and lower trading activities, further contributed to the bearish market sentiment. The correlation between crude oil and naphtha prices remained strong, with naphtha prices mirroring the declines observed in crude oil markets.
Focusing on the USA, the region experienced the most significant price fluctuations within North America. The overall trend was notably negative, influenced by seasonal factors such as the underwhelming summer driving season which did not meet expected demand levels.
In comparison to the same quarter last year, naphtha prices declined by 9%, reflecting a substantial year-over-year decrease. From the previous quarter in 2024, prices recorded a modest drop of 1%, highlighting a persistent but gradual decline. Within Q2, the first half of the quarter saw sharper price drops compared to the second half, recording a 6% decline. Concluding the quarter, the price of naphtha underscored a consistently negative pricing environment throughout the period. The market dynamics, characterized by high inventories and low demand, have overwhelmingly contributed to the negative sentiment, leaving the pricing environment firmly in the negative territory for Q2 2024.
APAC
The second quarter of 2024 has been challenging for the Naphtha market in the APAC region, marked by a consistent decline in prices driven by several significant factors. The primary reason for this downturn has been an oversupply of Naphtha, exacerbated by low demand from downstream petrochemical industries. Additionally, the continuous fluctuation and overall decrease in upstream crude oil prices have further pressured Naphtha valuations. Despite the occasional rallies in crude oil markets, the abundant supply and weak demand fundamentals have maintained a bearish sentiment across the region. Focusing on Japan, the country has experienced the most pronounced price volatility this quarter. The Naphtha market in Japan exhibited an overall decreasing trend, significantly influenced by seasonal factors and economic conditions. The quarter saw a substantial price decline, with a 4% dip between the first and second halves of the quarter. Compared to the same quarter last year, prices plummeted by 37%, reflecting a sharp contrast to the more stable 1% decline from the previous quarter in 2024. This indicates that the pricing environment has been predominantly negative, characterized by persistent downward pressure. The latest quarter-ending price for Naphtha CFR Tokyo stands at USD 703/MT, underscoring the negative trajectory. The overall trends in Japan reveal a confluence of oversupply, subdued demand, and stable yet unsupportive crude oil prices, leading to a decisive decline in Naphtha prices. This consistent decrease highlights the challenging market conditions, emphasizing the negative pricing environment throughout the quarter.
Europe
In Q2 2024, the European naphtha market experienced a notable decline in prices, influenced by several critical factors, creating a generally negative pricing environment. The primary factor was the significant drop in crude oil prices, which directly impacted naphtha's valuation. This decline in crude oil prices was driven by a combination of oversupply and weakening demand. Geopolitical tensions, particularly in the Middle East, exacerbated the situation by disrupting supply chains, while economic uncertainties in major markets, including Europe and the US, restrained industrial demand. Furthermore, increased naphtha supply from regions like the US Gulf Coast and the Arab Gulf, driven by arbitrage opportunities, contributed to the downward pressure on prices. High inventory levels, subdued purchasing activity, and cautious market sentiment due to inflationary pressures and economic sluggishness also played significant roles. Focusing on Germany, which witnessed the most substantial price changes, the overall trend in Q2 was characterized by a marked decline. The seasonal demand uptick typically expected during this period failed to materialize, largely due to weak downstream demand from sectors like petrochemicals. The correlation between declining crude oil prices and naphtha was evident, reflecting the interconnectedness of these markets. Compared to the same quarter last year, naphtha prices in Germany decreased by an impressive 15%. This stark contrast highlights the negative shift in market sentiment and economic conditions. In comparison to the previous quarter in 2024, however, the price change was recorded at 0%, indicating a stabilizing albeit low market environment. Within Q2 2024 itself, the first half of the quarter saw prices decline by 3% compared to the second half, evidencing a continual negative trend. Overall, the Q2 2024 pricing environment for naphtha in Europe, and more specifically in Germany, was decisively negative, driven by a convergence of oversupply, weak demand, and economic uncertainties, leading to significant price reductions.
MEA
During Q2 2024, the naphtha market in the MEA region experienced a steady decline in prices, driven by several significant factors. Firstly, the global crude oil market showed a downward trend, which directly impacted naphtha prices as it is a by-product of crude oil. Additionally, the surplus supply of naphtha due to high production levels and stable import activities led to an oversaturated market, further depressing prices. Coupled with weak demand from downstream industries such as petrochemicals, the market saw minimal buying interest, exacerbating the price drop. Focusing on Saudi Arabia, the country experienced the most pronounced price changes within the MEA region, reflecting the overall bearish sentiment of the market. Seasonal variations played a crucial role, as the transition into the off-season for gasoline and diesel shifted focus towards procurement activities rather than active trading. Moreover, despite a brief increase in demand for ethylene cracking, overall market fundamentals remained weak. The correlation between naphtha prices and upstream crude oil prices remained significant, with the latter's decline mirroring the former's downturn. The naphtha prices in Saudi Arabia decreased by 38% compared to the same quarter last year, highlighting the substantial downward shift. The percentage change from the previous quarter in 2024 was recorded at 0%, indicating that while the prices remained stable quarter-on-quarter, the yearly comparison presented a clear declining trend. A detailed comparison between the first and second halves of the quarter showed a 4% decrease in prices, underscoring the persistent downward momentum. This declining pricing environment reflects a predominantly negative sentiment, driven by oversupply, weak demand, and lower crude oil prices, maintaining a consistent bearish trend throughout Q2 2024.
South America
In the second quarter of 2024, the Brazilian naphtha market experienced a notable decline in prices, primarily influenced by the availability of cheaper imports from the USA. This trend was further exacerbated by a broader selloff in risk assets and a stronger US dollar, which impacted crude oil benchmarks. The demand for naphtha in Brazil remains strong, driven by its use as a feedstock in the petrochemical industry, particularly for the production of ethylene and propylene. growth. Overall, while the Brazilian naphtha market faced downward pricing pressures in Q2 2024, the underlying demand and strategic imports are likely to provide a stable outlook for the remainder of the year.
For the Quarter Ending March 2024
North America
In the first quarter of 2024, the North American Naphtha market witnessed significant fluctuations influenced by various factors. Global crude oil market instability, geopolitical tensions in the Middle East, and anticipated production cuts by oil-producing countries played a crucial role in driving up international crude oil prices during the previous quarter.
These developments motivated refineries to actively explore profit opportunities. Consequently, Naphtha prices in the US market experienced an upward trend, even though demand showed a decline. Interestingly, despite the overall decline in demand, there was a notable increase in Naphtha demand driven by the robust expansion of the US manufacturing sector. Additionally, recent reports from the Energy Information Administration indicated a reduction in US crude oil imports.
However, it is worth mentioning that the market also faced several shutdowns or disruptions, which, combined with a surge in inventories, contributed to a decline in crude oil crack prices. This decline subsequently led to lower production costs and further reduction in Naphtha prices. As a result, the Naphtha monthly price in the USA witnessed a 12.2% increase during the quarter, from USD 558 /MT to USD 626/MT. By the end of the quarter, the Naphtha weekly price in the USA reached USD 635/MT FOB Texas.
APAC
In the APAC region, recent surges in Naphtha prices have been driven by multiple factors. Geopolitical tensions in the Middle East, particularly the attacks on vessels in the Red Sea by Yemen's Houthi rebels, caused import prices to spike, resulting in increased Naphtha prices in Japan. Despite a global downward trend in the Naphtha market, Japan experienced Incline in prices due to increased demand and limited inventory levels. Although major plant shutdowns were not reported, various disruptions in the market further impacted prices. These disruptions, coupled with reduced demand and surplus inventory levels, contributed to the overall increase in Naphtha prices. In the upstream market, international crude oil prices fluctuated and ultimately trended upwards during the week. Hawkish signals from the Federal Reserve, indicating a delay in interest rate cuts, added to market uncertainty and dampened confidence. Naphtha futures followed suit, reaching levels not seen in a year, driven by growing concerns over potential supply disruptions stemming from escalating tensions in the Middle East. The sinking of the UK-owned cargo ship Rubymar in the Red Sea, resulting in significant spillage of fertilizers and oil due to an attack by Yemen's Houthi rebels, further exacerbated the situation. The spike in Asian demand, particularly in South Korea, can be attributed to an improvement in cracker demand. Recent increases in ethylene and butadiene prices have boosted margins and heightened the demand for naphtha, leading to higher utilization rates in South Korean crackers. This surge in demand has added to the upward pressure on naphtha prices in the South Korean market.
Europe
The demand for Naphtha in Germany has continued to rise steadily. In this quarter, the German market experienced a significant 4% increase in Naphtha prices compared to the previous quarter. This surge can be attributed to bullish sentiment prevailing in the European market, favourable trade dynamics favouring exports, escalating insurance premiums, and rising prices of downstream products. Additionally, the simultaneous uptick in international crude oil prices prompted refineries to actively pursue profit opportunities. Despite the considerable volatility witnessed in the international crude oil market, which provided cost support to the Naphtha market, there was a lack of substantial positive developments for the local refining Naphtha terminal. The latest reported weekly price of Naphtha CIF Hamburg in Germany for the first quarter of 2024 stood at USD 721/MT. Furthermore, the occurrence of multiple shutdowns during this period also contributed to the price hike and played a role in the overall surge in prices.
MEA
During the first quarter of 2024, the pricing of Naphtha in the MEA region remained volatile due to several factors. Fluctuations in crude oil prices had a direct impact on the pricing of naphtha, contributing to the volatility. Geopolitical tensions in the region also posed operational challenges to the production and supply chain of naphtha. Saudi Arabia, a major naphtha producer in the region, experienced a decline in supply due to geological disruptions in Middle East. This led to an increase in Naphtha prices in the country, which was further exacerbated by high demand from the downstream polymer sector. The pricing trend in Saudi Arabia during the first quarter showed a moderate positive correlation with crude oil prices, with a correlation coefficient of 0.56. Compared to the same quarter of the previous year, naphtha prices in Saudi Arabia increased by a significant 14%. These disruptions, combined with increased demand and the impact of crude oil prices, contributed to the overall volatility in naphtha pricing during the first quarter of 2024. In conclusion, the pricing of naphtha in the MEA region, particularly in Saudi Arabia, during the first quarter of 2024, was influenced by various factors, including fluctuations in crude oil prices, geopolitical tensions, supply disruptions, and increased demand. The current weekly pricing for Naphtha FOB Jeddah in Saudi Arabia is USD 677/MT.
South America
In the Brazilian market, the pricing dynamics of Naphtha have notably trended downwards throughout this month. This decline was primarily influenced by the availability of cheaper imports, particularly from the USA, where Naphtha prices experienced a decrease. The resulting increased import costs in Brazil directly correlated with this downward movement. Despite a contraction in Brazil's manufacturing sector, attributed to a decline in new orders, there is an optimistic outlook for the future, with companies considering expanding their workforces, indicating resilience and growth potential within the industry. Moreover, despite increases in crude oil prices in the upstream market, naphtha prices in Brazil have remained unaffected, highlighting the market's stability. Additionally, in the downstream market, although prices of benzene have risen, there has been no discernible impact on naphtha prices. Similarly, the prices of propylene have remained relatively stable with a slight incline, suggesting consistent purchasing patterns within the Brazilian market. This stability can be attributed to a decline in demand paired with a steady supply of naphtha, effectively balancing market conditions and preventing significant price fluctuations. Overall, the equilibrium between demand and supply has contributed to the observed stability in naphtha prices in Brazil.