According to the most recent data from Baker Hughes, the number of US rotary rigs drilling for oil was down by another 2 rigs last week, which brings the current number of US rigs drilling for oil to 536. Rigs directed toward drilling for natural gas are unchanged week-on-week at 162. Current year-on-year oil exploration efforts continue to be down 63.8 percent; year-on-year gas exploration is down by 50.6 percent.
None of this is good news for the US domestic and import J55 ERW oil country tubular goods (OCTG) markets. Oil prices continue to trend extremely soft, according to international news reports, and SteelOrbis sources continue to report that all of this continues to contribute to a very bleak outlook for the US domestic and import OCTG markets. For the month of December, US OCTG import tons have been recorded at 41,780 mt (US Department of Commerce, Enforcement and Compliance license data), which is a stark contrast from December 2014, when US import tons were recorded at 300,007 mt (census data). In terms of pricing, both US domestic and import quotations have trended lateral, but flexible US domestic spot prices continue to trend at approximately $42.50-$43.50 cwt. ($937-$959/mt or $850-$870/nt), ex-Midwest mill, while offshore futures prices from Korean and Taiwanese producers are also unchanged, $27.50-$29.50 cwt. ($606-$650/mt or $550-$590/nt), DDP loaded truck in US Gulf Coast ports.