On Wednesday, global oil prices fell below $27 per barrel for the first time since 2003, according to news reports, and many are concerned about the continued impact of volatile oil prices on the US domestic and import line pipe market. “Many of us have already written 2016 off,” one source said, noting that the pending influx of Iranian oil into global markets is likely to push oil prices even lower. US rig counts have fallen starkly year-on-year, and it’s not believed that US domestic drilling activity will increase based on the current oversupply of oil in the global marketplace.
In terms of pricing and order activity, pricing remains extremely flexible as sellers remain hungry for orders. Although US domestic and import offer prices are unchanged week-on-week, all price points are negotiable. Korean and Taiwanese producers are offering in an official range of $25.50-$26.50 cwt. ($562-$586/mt or $510-$530/nt), DDP loaded truck in US Gulf Coast ports while US domestic spot market prices are also relatively lateral since our last report a week ago, at approximately $45.00-$46.00 cwt. ($992-$1,014/mt or $900-$920/nt), ex-Midwest mill. Buyers and sellers continue to report the best measure of current market prices is “whatever you can sell for.”