API outlook positive despite 2024’s disappointing start

9th April 2024

Industry participants remain optimistic that activity in the API line pipe sector will gradually improve throughout the remainder of 2024, despite a disappointing start to the year.

Brent crude oil prices reached USD90 per barrel this week, after an upward trend during much of the first quarter, which has kept it firmly in territory that is perceived as favourable for oil and gas capital expenditure.  

Increasing geopolitical worries and supply concerns – centred on fears of a widening conflict in the Middle East – are driving oil prices higher. Nevertheless, those same factors have combined with elevated borrowing costs to delay project timescales for a number of line pipe projects. Consequently, demand for API coil and plates was lower than expected in the first quarter of 2024.  

European plate mills, in particular, were disappointed with their order intake for API plates during the three months to the end of March. They hoped that a pickup in line pipe activity would offset some of the decline in demand for plate from the wind tower sector. However, the mills remain hopeful of receiving improved bookings later in the year.  

Pipe makers report an increasing number of enquiries, especially for carbon capture projects in the United States, Canada and the United Kingdom. Several have been awarded in recent months. In addition, there are still numerous plans for pipelines in the UK, Italy and Poland which are expected to move forward between 2024 and 2026.    

European X60/X65 hot rolled coil and plate selling values fell during the January to March period due to weak demand. European buyers can purchase similarly priced material from South Korean mills producing API grade material. However, most prefer not to risk the elevated shipping costs and extended delivery times attached to such imports for very little cost advantage, at this time.  

In Asia, the prices for API X60/X65 hot rolled coil and plate were largely unchanged, quarter-on-quarter. Orders for shipbuilding continue to drive demand for plate in Asia. However, several plate producing steelmakers in the region are still offering deliveries for API X60/X65 hot rolled plate in the second quarter.  

European Steel Review image


European Steel Review

The MEPS European Steel Review is an informative, concise and easy-to-use monthly publication, offering unique professional insight into European carbon steel prices.

Go to productRequest a free publication