June 2010 | Seamless Steel Tube & Pipe
The US moratorium on offshore drilling: a disaster for OCTG demand?
The US government’s moratorium on offshore drilling is unlikely in itself to spell disaster for US OCTG demand. It is merely the latest, and perhaps least important, of a number of factors that will keep OCTG prices subdued in coming months.
The US government’s moratorium on offshore drilling might be expected to have serious implications for OCTG producers and distributors. It has already had an effect on some bookings: a number of pipe distributors in US states bordering the Gulf of Mexico have reported cancelled orders as a result of the moratorium. In MBR’s view, however, the moratorium is unlikely to turn into a disaster for the US OCTG sector. Distributors in the Gulf of Mexico basin that have accumulated stocks of high-grade seamless OCTG casing and tubing required by rigs drilling at depths in excess of 1,000 ft will of course be badly affected. Prices for this kind of OCTG are high and some distributors may be left holding expensive stocks that would otherwise have easily...
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