The US OCTG market is holding at status quo, while many within the oil and gas industry question whether Donald Trump’s recent remarks indicating he’d be willing to meet with he Iranian president in hopes of hammering out a new nuclear deal will place downward pricing pressure on oil prices.
Oil prices had been boosted in the 2nd quarter due to expectations that there would be less Iranian oil flowing into the market, after the US renewed economic sanctions on Tehran.
Market participants say they’re also waiting for the release of the Energy Information Administration’s monthly report on US oil production, along with updated information on US crude oil stockpiles. These numbers are expected to be positive, analysts note, but the question remains of how positive numbers at home will offset concern about a possible influx of Iranian oil into the global marketplace.
And while drilling companies are closely watching the political happenings that could have an impact on oil prices, US drilling activity remains strong; the number of US rigs targeting oil rose by three in the past week, while year-over-year oil exploration is up by nearly 12.5 percent.
As such, demand for energy pipe, including OCTG casing, remains strong, despite concerns of product shortages toward the end of the hear.
As with last week, import offers for Korean J55 OCTG casing is being heard in the range of $71.25-$72.25 cwt. ($1571-$1593/mt or $1425-$1445/nt), DDP loaded truck in US Gulf coast ports, while Taiwanese J55 OCTG casing is being sold to traders at $65-$66 cwt. ($1433-$1455/mt or $1300-$1320/nt) DDP loaded truck in US Gulf coast ports. Also as with last week, imported pipe being sold on the spot market is being sold between $2.50-$3.75 cwt. ($55-$83/mt or $50-$75/nt) higher.