Most OCTG, line pipe prices weaken in US

Prices for oil country tubular goods (OCTG) and line pipe in the United States mostly moved lower in November after the number of active oil and gas rigs dropped to a two-and-a-half-year low and drilling investment appeared to shrivel up going into 2020.

"Business is godawful," a southern distributor said. "Price is irrelevant because there is no demand... The biggest thing right now is the private equity folks and the shareholders are telling the [chief executive officers]: 'You will not spend on drilling. End of story. We want you to pay down debt and increase your dividends.' 2020 is going to be a bad year in the oil patch." Offers for imported line pipe plunged by almost $100 per short ton month on month after persistent reductions in domestic prices rendered the foreign material less competitive. Some South Korean producers have exported pipe into the US unsold and are uncertain of whether and how they will gather enough orders to exhaust their Section 232 quota for the first quarter of 2020, according to market participants.  "Business is terrible," an overseas mill source said. "These days we have to compete with the domestic. They are very competitive...

Published

Dom Yanchunas

November 27, 2019

21:46 GMT

New York