Downward pressure has been growing over the last few weeks on US domestic energy pipe prices, and the market is showing the first signs of softening.
As the second quarter draws to a close, the US domestic energy pipe market is seeing a level of price uncertainty that has been absent in the market for the last three to four months. Domestic pipe mills have been able to stave off major price declines following domestic hot rolled coil (HRC) spot prices falling about $7.00 cwt. ($154/mt or $140/nt) in the last two months, but pipe spot prices are now beginning to waver; this despite domestic flats mills announcing price increases of approximately $40/nt in just the last two to three weeks. Spot prices for API X42 electric resistance weld (ERW) line pipe have slipped about $0.50 cwt. ($11/mt or $10/nt) in the last week to $66.00-$67.00 cwt. ($1,455-$1,477/mt or $1,320-$1,340/nt) ex- Midwest mill.
As for domestic J55 ERW oil country tubular goods (OCTG) casing, while the spot price range is unchanged at $66.00-$67.00 cwt. ex-Midwest mill, the upper end of the range is eroding. As with last week, while it's too early to tell how much OCTG casing spot prices will fall, the decline won't be dramatic if demand remains stable and rig counts continue to rise. US rig counts were up seven last week after jumping by 17 rigs the week before.
On the import side, some interest in booking imports has faded moderately since late May, but overall activity is still steady. After falling about $2.00 cwt. ($44/mt or $40/nt) last week, Korean J55 ERW OCTG casing offer prices to the US are steady at $55.00-$56.00 cwt. ($1,213-$1,235/mt or $1,100-$1,120/nt) DDP loaded truck in US Gulf ports. Korean offers of API X42 ERW line pipe on the other hand have slipped slightly to $53.00-$54.00 cwt. ($1,168-$1,190/mt or $1,060-$1,080/nt) DDP loaded truck in US Gulf ports-down $0.50 cwt. since last week.