South Korea: Oil wells, pipeline production rises over 15%, m-o-m, in May

Production and sales of oil wells and pipelines have registered a significant growth in May owing to soaring international oil prices.

South Korea's oil well and pipeline production rose by 17% to 104,893 tonnes (t) in May 2022, compared with 89,651 t in the previous month. Output rose 38% y-o-y against 76,060 t in May 2021.

During the first five months of the current calendar year, oil and well production stood at 435,184 t, up 29% from 337,018 t in the corresponding period last year (CPLY).

Sales up 30% m-o-m in May

Sales registered a rise of 30% m-o-m to 106,357 t in May 2022 compared with 81,670 t in the previous month. On an annualized basis, sales surged 58% compared with 67,217 t in May 2021.

Exports accounted for 94,162 t in May, up 17% m-o-m from 80,265 t in April. Exports rose 45% as against 64,883 t in May 2021.

Domestic sales stood at 12,195 t in May 2022, versus 1,405 t in last month. It was recorded at 2,334 t in May 2021.

Cumulative sales stood at 431,164 t (up 33% y-o-y) during Jan-May. Exports were recorded at 408,454 t (up 31% y-o-y) and domestic sales at 22,710 t (up 67% y-o-y) during the Jan-May period.

"The impact of high global oil prices and the consequent expansion of steel pipe exports to the USA seem to have led the surge in production and sales of oil wells and pipelines this year," said an industry source.

Outlook

The yearly exports quota to the USA is limited to 1 mnt. It is anticipated that the export quota expansion to other regions like Canada will continue in H2CY'22.

Also, the profitability is that exports are likely to increase as the exchange rate ($/KRW) remains at levels of KRW 1,300.

Note: This article has been published in accordance with an article exchange agreement between Steel Daily and SteelMint.