US OCTG market holds lukewarm; market players remain unenthusiastic

The most recent data from Baker Hughes indicates that for the week ending June 18, the number of US rigs drilling for oil recorded an additional nine-rig increase, which marks the third straight week that the number of US oil rigs have shown gains, but the fact that there are still 294 fewer rigs targeting oil than this time last year is tempering overall excitement.

“Gains are certainly better than losses but people are hardly busting out the champagne,” one source said, adding that many companies, and salespeople, are “simply trying to stay afloat.”

In terms of pricing, US domestic prices for finished ex-mill J55 ERW OCTG casing are still “too hard to call,” sources continue to report, noting the bulk of domestic transactions are happening at the service and distribution center level, as there is “still months-worth of years-old inventory that’s sitting on the ground.”

Looking offshore, futures offers from Korean and Taiwanese producers of unfinished J55 ERW OCTG casing 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, but as in previous weeks, interest in booking futures remains light.