The US domestic energy pipe markets are mostly unchanged week-over-week, as depressed rig counts and wobbly oil demand—and thus, wobbly oil prices—continue to hinder the market.
For example, earlier this week, the International Energy Agency predicted that global demand for Brent crude will drop by 8.1 million per barrels, per day, in 2020. A decline of 8.1 million barrels per day, the IEA continues, represents a loss of roughly $324 million in oil sales per day. As a whole, the market is not expected to regain "more stable footing" until the latter part of the year.
Rig counts are also still a problem. As of last Friday, Baker Hughes reported that the total rotary rig count in the US declined by 5, to a combined oil and gas rig tally of 279. Last week’s levels reflect a roughly 71.2% year-over-year decline. Year-over-year oil exploration in the US is down 74.7 percent; gas exploration is down 56.9 percent.
“I’ve talked to a couple people today that have told me about pricing that is absolutely crazy,” a source said. “I thought we might avoid a price fall off due to limited inventories but turns out there is more inventory and less demand that I thought. I do feel we have gotten extremely close to the bottom in terms of X52 and J55 prices because replacement costs are higher than what people are selling at. It’s ugly out there, for sure.”
As with last week, pricing for stock API-X52 line pipe is being heard at approximately $42.50 cwt. ($937/mt or $850/nt), ex-mill, although some sources have reported that deals have been available. Mexican material, on the other hand, is still being heard at approximately $45.00 cwt. ($992/mt or $900/nt), FOB Texas.
Also consistet with last week, sources have confirmed that stock domestic J55 ERW OCTG casing is still being traded at or slightly below $45.00 cwt. ($992/mt or $900/nt), ex-mill. Activity, sources have said, remains weak at best.