According to the most recent data from Baker Hughes, the number of US rotary rigs drilling for oil fell by an additional 31 rigs last week, which brings the current number of US rigs drilling for oil to 467. Rigs directed toward drilling for natural gas are also down an additional 17 rigs since our last report a week ago. Current year-on-year oil exploration efforts continue to be down 59.0 percent; year-on-year gas exploration is down by 66.9 percent. The weekly average of crude oil spot prices is 38.1 percent lower than last year and natural gas spot prices are 21.3 percent lower than last year.
“The market is very slow and that’s all there is to say about things right now,” one source said. “There are a lot of pipe salespeople who are dusting off their resumes because there are just no guarantees right now.”
As with previous weeks, falling rig counts, stalled drilling projects and a global supply overhang of oil has prices for both US domestic and import J55 ERW OCTG casing trending extremely flexible. Although the average US domestic spot market price range has remained lateral in the past seven days, at approximately $42.50-$43.50 cwt. ($937-$959/mt or $850-$870/nt), ex-Midwest mill, all pricing is flexible, sources continue to note. In terms of futures prices from Taiwanese and Korean producers, that is also mostly neutral at $27.50-$29.50 cwt. ($606-$650/mt or $550-$590/nt), DDP loaded truck in US Gulf Coast ports, but sources continue to confirm that sellers are “committed to selling at any price that would get them an order.”