Paper sold the AG recovery early and is now clawing it back, with the bias staying constructive on the E/W and Western premiums
Paper structure took the brunt of the AG supply recovery over the week, with the MOPJ timespread down $8.25/mt to $20/mt and the NWE timespread $6.75/mt lower at $21/mt, although today’s session is already clawing back part of that move across spreads and cracks.
The selloff came on the return of Gulf crude barrels, with the Saudi East-West pipeline ramping up to around 2 to 2.65 mb/d against 5.5 mb/d before the attack and 3 to 4 mb/d expected in the coming days, while the UAE and Kuwait lift naphtha exports to Asia outside Hormuz.
Med physical prices are already pricing the Eastern outlet, with FOB prices up $10/mt on the week in average.
Freight caps how far the pull can go, with TC5 at $187/mt, up 65% over four weeks, keeping delivered costs into Asia high.
Today’s bounce shows the paper priced an AG recovery the physical has not yet confirmed, so the bias stays constructive on the E/W and Med premiums, with the risk being tracked AG naphtha loadings reaching Asia in volume and shutting the Med arbs again in the medium term.
About the Author
Jorge Molinero | Commodity Owner, Light Ends & Gasoline, Sparta Commodities
Jorge is Sparta’s Commodity Owner for gasoline and light ends. He began his career as a financial analyst at BBVA before spending four years as a naphtha analyst at Repsol. His market analysis is cited by Reuters, Bloomberg, and Financial Times.
Connect: LinkedIn
About Sparta
Sparta is the AI leader for commodity trading, home to Leonidas AI, the first decision-making engine for oil and commodity traders. Backed by USD 42 million in Series B funding led by One Peak, with participation from returning investors FirstMark and Singular, the same investors behind AI leaders like Legora, Dataiku, and Synthesia. From independents to multinationals, the world’s leading commodity teams use Sparta and Leonidas AI to move faster, trade smarter, and stay ahead of the market.
For more information, visit Sparta or follow us on LinkedIn.
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