The spread between solvent naphtha distribution prices and barge prices has hit an 11-month high after supply tightened on the back of exports from Europe in the fourth quarter and lower sales out of Shell's refinery at Pernis, the Netherlands.
Shell was not available for comment.
Solvent naphtha trucks prices were assessed at Eur670/mt FD NWE Tuesday, S&P Global Platts data showed, in line with reported traded levels. The truck price rose Eur15/mt on Tuesday and has risen Eur70/mt in the space of a month. Solvent naphtha truck prices in Europe have also been supported by a weaker euro, sources have said.
The barge price of solvent naphtha was assessed at $545/mt FOB ARA, down $10/mt. Solvent naphtha barge prices have fallen $50/mt in November alone, as feedstock gasoline has declined in line with seasonal patterns and lower crude oil prices.
Measured in dollars, the spread between barge and truck prices stood at $171.90/mt Tuesday, its highest since December 8 last year.
One European distributor said Shell at Pernis would have little to no material available for months, adding solvent naphtha availability in Northwest Europe had tightened considerably since October.
A second distributor said Shell had told customers there had been production issues on its solvent naphtha production line since early October, and they had been partially resolved.
"They cannot produce as much solvent naphtha as they would like. Supply restrictions will last for a while," the second source said.
Along with production issues in Europe, solvent naphtha exports from Europe in October and November have tightened availability, sources said.
