US import OCTG market not bolstered by ongoing upticks in rig count

According to the most recent data from Baker Hughes, the US rotary rig count increased by 10 for week ending August 19, bringing the current total to 491.  The uptick is credited to a 10-rig increase in the number of rotary rigs drilling for oil, which brings the current tally to 206.  There are, however, still 268 fewer rigs targeting oil during the current reporting period than there were this time last year.

Year-over-year oil exploration in the U.S. is down 39.8 percent. The weekly average of crude oil spot prices, however, is 12.1 percent higher than last year.

Some analysts predict that oil prices will wobble at the $50 per barrel mark for the next year. Even if OPEC moves to cut some production, it’s not believed that will have too much of an impact in global oil prices, due to ongoing and marked production rates in other regions of the world.

In terms of how this impacts the US domestic and import J55 ERW OCTG casing markets, sources say things are still slow.  Futures pricing for unfinished J55 ERW OCTG casing from Korea and Taiwan are still being heard in the approximate range of $27.50-$29.50 cwt. ($606-$650/mt or $550-$590/nt), DDP loaded truck in US Gulf Coast ports, and while some traders are reporting modest upticks in activity, others say there is still a lot of reluctance when it comes to booking futures.  “There’s still plenty of pipe on the ground,” one source said.