Page 12 - ITAtube Journal 3 2024

Market information
Figure 8: Representative Steel Tube and Pipe Prices
(OCTG – P110 USA and Structural S235 Turkey)
Source: Kallanish.com
Figure 9: Oil price WTI development 1 year up to 6th
of December 2024 (US$/Bbl.)
Source: US Energy Information Administration
Figure 10: US Crude Oil Production as per August 2024 since 2020
Source: OilPrice.com
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Billet prices, applied for seamless tubes
are traded for an average of around 525
USD/ton.
In 2024 almost all prices for tubular
pre-materials were coming down. Anyhow
it remains challenging to predict the
pre-material price developments.
Figure 8, shows the price development for
two representative tube grades since June
2022:
-
P110 OCTG O.D. 5,5” alloyed casing pipe.
-
S235 non alloyed structural pipe.
The OCTG pipe price for P110, after its
hight in October 2022 (ab. 3.900 USD/ton)
experienced a price decline of ab. 58%
until August 2024 (ab. 1.650 USD/ton) -
however, since then, it seems the price has
stabilized at a level of 1.750 USD/ton.
The structural pipe S235 although on a
much lower price niveau, characterized by
much less volatility almost maintained its
price level at ab. 610 USD/ton. Comparing
the price difference between HRC and
finished structural tubes and pipes type S
235 on Turkish basis, it becomes obvious
how small the margins for tube producers
of such products with about 30 USD/ton
are. There were even time periods, with
negative margins.
The major driver of the tube and pipe
industry is the oil and gas market rep-
resenting about 51% of the world tube
and pipe production. The consumption
of OCTG tubes directly relates with the
oil price (figure 9, see also previous tube
market reviews). OPEC+ during the past
years have unsuccessfully tried to keep
the oil price at a minimum level of 90 USD/
Bbl. by voluntary supply cuts of 2 million
barrel/day. These cuts have only recently
been prolonged until mid-2025 to stabi-
lize the oil price. Anyhow the oil price WTI
eroded in 2024 from April (87 USD/Bbl.) to
December (67 USD/Bbl.). The USA on the
other hand extended their oil production
capacity becoming the largest oil and gas
producer in the world. The new president
Trump even announced to further encour-
age US companies to pump more oil and
gas. This announcement does not stimu-
late the oil price to rise despite the numer-
ITAtube Journal December 2024