US spot benzene dipped 3 cents/gal from Friday to hit a two-month low of $4.06/gal FOB US Gulf Coast on Monday, continuing the downward trend seen recently. Since March 9 when benzene was assessed at $4.23/gal FOB USG, the price has been falling steadily on weaker downstream demand.
The decline should continue for a while as downstream demand is not expected to rise in the near future, traders said Monday on the sidelines of the American Fuel and Petrochemicals Manufacturers' petrochemical conference in San Antonio.
A South America-based trader even saw the price decline continuing through the second quarter. Saying that he had heard that the price could fall as much as 50 cents/gal, he, however, added that he did not see this as likely.
An Asia-based source, however, said the fall could come to a halt if crude and gasoline prices, which benzene usually tracks, rise or if downstream demand picks up.
Meanwhile, the US benzene contract price for April settled 12 cents lower Friday at $4.12/gal ($1,231.88/mt). It was the first drop in benzene contract price since December.
The fall in contract price was an indication that spot benzene was trending downward, a Houston-based trader said.
AFPM or American Fuel and Petrochemical Manufacturers was previously known as NPRA or National Petrochemical and Refiners Association.