US Naphtha Falls 0.5% in Early Jan 2026, Tracking Loose Crude Inventories and Muted Demand

The US Naphtha market continued to feel downward pressure during early January 2026 because of continued oversupply and low demand. Stable and high refinery utilization produced uninterrupted production of naphtha, supported by ample availability of crude oil in addition to no disruptions from operational issues. Inventory levels remained at comfortable levels, which contributed to reduced urgency to buy among auto makers and other industry players. Additional bearish sentiment towards naphtha, as evidenced by weak and neutral crude oil fundamentals, remained consistent across market participants due to the abundance of mixed inventory signals and an adequate domestic supply of naphtha, despite reduced import levels and depressed production forecasts later in the year. Only on-ship imports into China and a decline in production during the last quarter of the year were likely to drive a pull-on US export. Lower than normal downstream demand by petrochemical producers in China remained a deterrent to optimistic expectations of growth in US export sales in the coming months due to the increased imports of substitute feedstocks by many Asian cracker plants.