PetroScan Oil & Gas Monthly - Uptick in refining margins sustainable? - Emkay

- Asian Spot LNG prices continued their downtrend in July'12 on account of high inventory levels and start of Japanese nuclear reactors

- Benchmark Singapore refining margins increased in July'12 as spreads across Gasoline, LPG and Naphtha increased. GRMs averaged at $8.0/bbl in July'12 v/s $5.5/bbl in June'12. However, we expect renewed weakness in margins owing to weak fundamentals.

- Cracker margins declined in July'12 as increase in by-product prices lagged increase in naphtha prices. Average for July 12 was at US$131/ton v/s US$169/ton in June'12.

- Within polymers, margins across the PE-integrated and PE-non integrated segments decreased on MoM basis. Margins for PP and PVC declined. Polyester chain margins have been mixed, with margins for fiber intermediates i.e. MEG-Ethylene margins and PTA-PX margins declining and margins for PFY & PSF increasing.

Source : Equity Bulls

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