South Korea: Soaring international oil prices to fuel demand for steel pipes

The recent surge in international oil prices in South Korea due to Russia's invasion of Ukraine is expected to positively affect the export of piping materials for energy, including oil wells and pipelines.

International oil prices

In fact, the recent international oil prices, the price of Dubai crude oil exceeded $116 per barrel as of 3 Mar'22, Brent crude oil from the North Sea also recorded $110, and the price of crude oil from West Texas also recorded $107 per barrel.

Outlook

The increase in the number of rigs in North America is expected to continue, and the demand for related LNG steel pipe products is also expected to continue to expand.

According to the pipe manufacturers, there is a limit to the expansion as the annual quota for exports to the United States is set at 980,000 tonnes (t), but the demand for energy steel pipes in other regions is expected to continue.

It seems unlikely that Russia's invasion of Ukraine will end early, and concerns over global energy supply and demand are growing.

As steel raw material prices rise and product sales prices are in the process of being raised, it is expected that such a signal to improve demand will positively affect the announcement of the price hike, thereby improving profitability.

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