Overview
Naphtha cracks in the East and the West weakened at the end of 2025, extending the weakness into the new year. The M1 NWE naphtha crack dropped from a high of -$4.20/bbl on 22 Dec to -$5.65/bbl at the time of writing on 05 Jan.The Feb/Mar’26 NWE spread fell from $4/mt on 22 Dec to $1/mt on 05 Jan, highlighting a loosening of supply. Meanwhile, in the East, the M1 MOPJ crack softened from a high of -$0.20/bbl on 22 Dec to -$1.65/bbl at the time of writing on 05 Jan. The Feb/Mar’26 MOPJ spread eased from $6/mt on 22 Dec to $4.25/mt at the time of writing.
Fundamentally, Washington’s capture of Venezuelan President Nicolas Maduro raises questions around Venezuelan oil exports, which remain under a complete US blockade. In the scenario where this embargo is lifted under US control of Venezuelan oil, demand for naphtha as a diluent for heavy crude may support prices. However, ample naphtha stocks in the US Gulf Coast, due to the abundance of alternative petrochemical feedstocks, alongside concerns about a crude glut in 2026, may cap this upside.
