Monday, May 21, 2012
SINGAPORE (Dow Jones)--Abu Dhabi National Oil Co. is seeking to significantly raise premiums for term naphtha supply for the July 2012-June 2013 period, but buyers will likely resist when negotiations continue this week, a trader said Monday.
State-owned Abu Dhabi National Oil Co., also known as Adnoc, has made offers exceeding July 2011-June 2012 premiums by up to 40%.
Adnoc has offered splitter naphtha at $28.5 a metric ton above its own pricing formula and sought a premium of $29.50/ton for paraffinic naphtha.
"This price level is very difficult to accept," the trader said, adding that the market was expecting premiums in a $25-$27/ton range.
The United Arab Emirates-based refiner fixed its prices for the period ending June 2012 at $20.50/ton above its own formula for splitter grade, $21.50/ton for low-sulfur grade and $24.50/ton for paraffinic grade.
Adnoc sells most of its naphtha on term basis and holds negotiations for term agreements thrice a year for three separate terms.
The company last held talks for April 2012-March 2013 term naphtha supply. It made initial offers at relatively high levels but later agreed to a lower premium of $25.50/ton to its own formula for the Pentane Plus grade and $23.50/ton for low-sulfur and splitter grade naphtha.
-By Jacob Gronholt-Pedersen, Dow Jones Newswires; +65-6415 4065; jacob.pedersen@dowjones.com
(END) Dow Jones Newswires
21-05-12 0333GMT
