Oil Well Pipe Market Divided in Middle and High, Lower Grade

Oil well steel pipe market is divided into middle- and high-grade and lower grade. Chinese pipe makers increase the export of lower grade products and the users shift to Chinese products mainly for American Petroleum Institute (API) grade. The lower grade supply gets easier. However, the middle- and high-grade supply is still tight under strong demand due to the limited sources for some products including heat treated products with special screw. The middle- and high-grade export price is still high level. Japanese pipe makers accelerate to shift to high-grade segment with emerging low grade suppliers.

Oil majors try to develop new sources under high oil price. The aggressive capital expenditure increases the oil well pipe demand worldwide.

However, Chinese steel pipe makers have expanded the seamless pipe output capacity in years. China turned into net exporter of seamless pipe with the higher capacity than domestic demand. The makers increase the export to USA while they ship the pipe to traditional buyers in South East Asia. The users shift to Chinese oil well pipe for lower API grades.

The demand is strong for middle- and high-grade oil well pipe. The middle-grade product of heat treated oil well pipe with special screw, L80 grade gets tight supply due to limited heat treating capacity worldwide. The market price hit US$ 2,000 per tonne, which is near 3 times of the price 10 years ago. High-grade item of 13% chrome oil well pipe’s price is still high due to limited sources despite of the overstock in USA.