The North Sea butane/naphtha price spread has risen on increasing demand for refrigerated butane cargoes in Northwest Europe, according to industry sources.
During the winter months in Northwest Europe most North Sea mixed butane is either blended into gasoline or used as a feedstock for the production of MTBE and alkylate.
The three main importers of refrigerated mixed butane cargoes are the Petroplus refinery on the River Thames, UK, the Valero refinery at Pembroke, Wales, and the LyondellBasell MTBE plant in Rotterdam, Netherlands.
Based on Platts data, the butane/naphtha price ratio remained above 95% during the first three weeks of November.
Over the last decade of November, however, a technical problem at Coryton and some reported delays in recommissioning the LyondellBasell Rotterdam plant combined to give the butane market a more bearish feel and the butane/naphtha price ratio dipped to around 90%.
Since then, industry sources reported that the LyondellBasell plant was operational again, although there still appeared to be no requirements for butane imports into Coryton.
With demand for North Sea butane now said by sources to be increasing, the butane/naphtha price ratio strengthened again reaching a last published level Monday of 92.7%.
The availability of unplaced North Sea cargoes over the balance of December was also said by sources to be a bit tighter with product moving to Morocco and the East Mediterranean.
"Some tonnes are definitely moving south," said one trader.
