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Tubular Segment of US Steel remained highlights for company in Q3-The 19th China(Guangzhou)Int'l Stainless Steel Industry Exhibition
11/30/2017 Stainless Steel Exhibition |
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The Tubular segment of the US Steel has remained a highlight for the company in its third quarter results which was released at the beginning of this month. Recovery in global crude oil prices has helped improve the shipment volume and price realization of the Tubular segment of US Steel.
The US Tubular segment produces steel pipes (Oil Country Tubular Goods or OCTGs) used in oil and gas drilling, the demand for which is directly proportional to global crude oil prices . Crude oil prices have seen a downturn since 2014 due to the global over supply situation. As a result of this downtrend, the top line of the Tubular segment was significantly affected. Revenue contribution of the Tubular segment to the total revenue of the company came down from 17% in 2012 to 4% in 2016 due to the increasing pressure on oil drilling activities in the US.
Crude oil has seen a recovery in its prices this year due to the production cut initiated by the Organization of Petroleum Exporting Countries (OPEC) since January 2017. OPEC decided to cut crude output by 0.8 million barrels per day from January 2017 which accounts for approximately a 2% reduction of global oil supply. The improved pricing environment for crude oil has helped recover the oil and gas drilling activities in the US, which in turn has translated into higher demand for OCTGs and an increase in the Tubular Product division''s shipments. Furthermore, an increase in demand for OCTGs has resulted in better price realizations for the company from its Tubular segment.
-The 19th China(Guangzhou)Int''l Stainless Steel Industry Exhibition
- Stainless Steel exhibition,2018
Stainless Steel exhibition, China Stainless Steel exhibition,
Guangzhou Stainless Steel expo,Guangzhou
Stainless Steel exhibition, 2018 Stainless Steel expo,
China Stainless Steel expo
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