Prices for OCTG pipes in North America remained stable in September

Quotations for welded pipes in Turkey fell by $18 per tonne over the same period due to weak demand in the EU

The average price of OCTG pipes on North America FOB terms in September stood at $2,191 per ton. Market participants are currently observing unfavorable conditions in the oil industry. During the same period, WTI quotations fell by 2.2% to $62.5 per barrel after falling by 7.8% in August.

At the same time, there are positive changes in the US oil and gas industry. According to Baker Hughes, the trend of reducing active oil and gas drilling rigs in the US stopped in September. The number of rigs increased by 13 units to 549, while in previous months there was a decrease.

In the future, the OCTG pipe segment may receive support thanks to the investment plans of American energy corporations, which intend to invest about $50 billion in the development of pipeline infrastructure in the US over the next five years amid growing demand for gas and expansion of LNG exports. According to consulting firm Wood Mackenzie, corporations are already implementing or preparing to implement pipeline projects with a total length of more than 14,000 km in the country.

In September, Turkish welded pipe prices were under pressure from weak demand in Europe and the exhaustion of the October export quota. According to Kallanish, prices for this product fell by $18 last month to $575/t (Turkey FOB), despite rising production costs at the end of the month. This price dynamics fully correlates with the change in prices for hot-rolled coil on Turkey FOB terms, whose average quotations in September fell by $7 to $537/t.

In addition, the recent change in the domestic processing regime (DIR) has increased pressure on manufacturers. Starting October 1, exporters of certain types of products in Turkey are required to purchase at least 25% of the raw materials/semi-finished products necessary for their production on the domestic market. This requirement increases the costs of local pipe manufacturers, who often use imported HRC when domestic prices are uncompetitive.

It is worth recalling that Interpipe is expanding its presence in the mining industry product segment. The company has fulfilled a trial order from a French manufacturer of drilling tools, supplying linear pipes that meet European standards. Earlier, it was reported that Interpipe had manufactured pipes for underwater operation in shallow water for the South Akçakoca Sub-Basin (SASB) gas field in the Black Sea for the first time.