HTC to Continue Naphtha Cracker Operations Despite PX Force Majeure — OPIS

South Korea's Hanwha TotalEnergies Petrochemical will continue operating its naphtha cracking center facility in Daesan to ensure stable petrochemicals supply, despite a force majeure declaration on paraxylene supply on Monday, the government said in a notice on Friday.

No major disruptions will be caused from the force majeure, the government said. HTC's cracker, fed flexibly by naphtha and LPG, has a nominal capacity of 1.5 million metric tons per year ethylene and 810,000 mt/year propylene, OPIS data shows.

The force majeure declared on April 13 was due to supply and delivery disruptions of raw materials required for production amid the ongoing Middle East conflict, according to a company notice seen by OPIS.

HTC previously notified customers on April 1 that it had cut production since March and could consider further output cuts or partial shutdowns, without specifying the product, according to a letter seen by OPIS.

A recent OPIS survey shows that flexible crackers across Asia have been pivoting from naphtha toward higher LPG cracking activity, thanks to LPG's comparatively lower reliance on Middle Eastern supply, which has made cargo sourcing more viable for crackers facing depleting inventories.

Still, operating rates for the country's naphtha crackers have fallen sharply from 80% to 55% due to the disrupted supply of feedstocks since the Iran war began at the end of February, although Seoul is pushing domestic producers to raise runs to 70% in the coming months.

South Korea has secured up to 2.1 million metric tons of naphtha to cover cracking activity by approximately one month, with shipments expected to arrive from the end of April. As part of broader measures to address supply constraints, the government has also approved KRW 674.4 billion ($492 million) in supplementary budget support to facilitate naphtha imports.

Asia's energy market has been bearing the brunt of Middle East tensions. South Korea has been particularly vulnerable, with more than half of the country's naphtha reliant on imports and over 70% of imported naphtha sourced from the Middle East.

Spot production cash margins for naphtha remain in the red, with losses deepening significantly to $619/mt in the week ended on April 2, compared with a discount of $254/mt on March 12, according to the latest data from Chemical Market Analytics by OPIS.

This content was created by Oil Price Information Service, which is operated by Dow Jones & Co. OPIS is run independently from Dow Jones Newswires and The Wall Street Journal.

--Reporting by Yiwen Ju, yju@opisnet.com; Editing by Mei-Hwen Wong, mwong@opisnet.com

(END) Dow Jones Newswires

April 17, 2026 05:06 ET (09:06 GMT)