Demand for seamless line pipes in Saudi Arabia has not been so steady during the past month. The main reason for this has been the uncertainty in the oil market. OPEC's average compliance with its goal of cutting output to balance the market stands at about 65 percent in November, and OPEC is not expected to make a decision to increase crude oil production at its next meeting in December. Meanwhile, the price policies of overseas seamless line pipe suppliers indicate a variety of trends. Offer prices from top-tier European mills have increased by $25-50/mt in some cases over the past month. Import quotations of seamless pipes from Romania and South Africa have risen by $50-100/mt. At the same time, Ukrainian mills have decreased their offers for Saudi Arabia by $30-50/mt over the period under review. Finally, import prices of seamless pipes from Russia and China have remained at their previous levels.
In particular, offers of Chinese seamless pipes 2"-6" grade B made to ASTM A106/API 5L are being given to the Saudi Arabian market at $700-750/mt C&F.
Quotations of Ukrainian seamless pipes (Interpipe) 2"-8" grade B made to ASTM A106/API 5L are at $900-950/mt C&F, while 10"-12" pipes are priced at around $1,000-1,050/mt C&F.
Russian seamless pipe offers to Saudi Arabia from TMK subsidiary Volzhsky Pipe Plant are in a range of $950-1,000/mt C&F for material under 8" grade B made to ASTM A106/API 5L, while 10"-16" seamless pipes can be heard at a maximum of $1,050-1,100/mt C&F.
Romanian and South African seamless pipes (ArcelorMittal) 2"-10" grade B made to API 5L are quoted at around $1,100-1,200/mt C&F Saudi Arabia.
Quotations of seamless pipes to Saudi Arabia from Italy and Argentina (Tenaris), France and Germany (V&M), and from Japan (Sumitomo) for 2"-6" grade B made to ASTM A106/API 5L are varying at about $1,250-1,350/mt C&F, while 10"-12" pipes are priced at around $1,400-1,475/mt C&F.
Market players report a slowdown in new oil projects. Customers are still spending a lot of time on tenders and do not appear to be in a hurry to convert tenders into orders. Oil producers have suffered a slump in orders as customers scrap or curb planned exploration spending amid tighter credit markets and lower oil prices. Competition has intensified as contracts have dwindled. All these factors may hold back the demand for line pipes and OCTG, and may prevent significant price growth.