It’s been nearly two years since the 2014 oil price crash, when oil prices fell by 50 percent between June and early December. And while the US domestic and import energy pipe markets continue to trend sluggish, many feel that while a recovery is on the horizon, it will be long and slow in nature.
“There’s still some inventory that needs to be worked through,” one source said, “but at least we’re seeing some positive things in terms of rig counts.” The most recent date from Baker Hughes indicates that for the week ending Oct. 7, 2016, the number of rotary rigs drilling for oil was up three, to 428. This is a sizable bump from week ending July 29, 2016, when there were 347 rotary rigs drilling for oil.
In terms of futures offers, pricing for unfinished, US import oil country tubular goods tubing from Korea has firmed by approximately $0.50 cwt. ($11/mt or $10/nt) on the low end, and $1.50 cwt. ($33/mt or $30/nt) on the top end since our last report a week ago, to $33.50-$34.50 cwt. ($739-$761/mt or $670-$690/nt), DDP loaded truck in US Gulf coast ports. Oct. 5 data from the US Department of Commerce, Enforcement and Compliance shows that for the month of September, the US imported 17,136 mt (license data) of OCTG casing from Korean steelmakers.
Looking onshore, SteelOrbis sources report that they still see US domestic pricing as “unimportant,” due to domestic tube mills still being “close to idled” based on lagging sales volumes and still-not-sold distribution center inventories.