Rig counts within the US have taken another tumble; the number of drilling rigs has fallen by 56 since our last report a week ago bringing the March 20 week-end total to 1,069. Industry analysts note this is the lowest level seen in the past five years. Approximately 50 percent of the drilling rigs in Colorado have been idled since November and many believe the drops are not over. Some think the US domestic rig count is bound to fall below 1,000, and that falling oil prices have yet to see their bottom. “At best, this thing probably won’t turn around until late this year,” according to a Midwest-based source.
Not surprisingly, spot prices within the US domestic API X-42 electric resistance weld (ERW) line pipe market are bearing the brunt, having fallen by approximately $3.00 cwt. ($66/mt or $60/nt) since our last report a week ago bringing the current average span to $45.00-$46.00 cwt. ($992-$1,014/mt or $900-$920/nt), ex-Midwest mill. Offshore prices, however, have held stable. Futures offers from Taiwanese and Vietnamese producers continue to trend in the approximate range of $35.00-$36.00 cwt. ($772-$794/mt or $700-$720/nt), DDP loaded truck in US Gulf coast ports, although at this point, interest in futures remains scant.