Naphtha Benchmark Prices Soften as Cracker Feedstock Substitution Increases

Feedstock Competition and Substitution

Modern crackers are now more flexible, allowing them to shift away from naphtha when LPG prices drop. This substitution is evident in the Asian market, where the glut of US NGLs provides a cost-effective alternative.

Refining Surplus and Blending Value

As gasoline prices fall, the byproduct supply of naphtha from refineries is becoming an inventory burden. This surplus is weighing on benchmark prices, even as the aromatics complex remains tighter.