The US domestic and import API X-42 ERW line pipe markets continue to suffer at the hands of a global oil supply glut. Oil barrel prices settled at $46 yesterday, according to news outlets, which marked the highest price-point seen for 2016.
And while the $46 per-barrel level is nearly 75 percent higher than prices seen in mid-February, these higher price points have done nothing to help US domestic drilling activity. The number of US rigs drilling for both oil and natural gas are down substantially year-on-year.
Line pipe market players say that at this point, they’re just “trying to hang onto our hats and make it through the storm,” one Midwest-based source said.
In terms of pricing, everything has held lateral.Futures offers from both Korean and Taiwanese producers for API X-42 EWR line pipe are still being heard in the approximate range of $25.50-$26.50 cwt. ($562-$586/mt or $510-$530/nt), DDP loaded truck in US Gulf Coast; US domestic spot market prices are still being heard at approximately $45.00-$46.00 cwt. ($992-$1,014/mt or $900-$920/nt), ex-Midwest mill, although recent upticks in US HRC pricing has US domestic pipe mills trying to push prices up.
Other sources close to SteelOrbis, however, say “it doesn’t matter what the spot market price is because people just don’t need to buy pipe from the mills. There is already plenty of inventory that is still sitting around on the ground.”