Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

A challenging oil drilling market along with the spread of the COVID-19 virus has prompted Tenaris to announce layoffs as well as a temporary suspension of its US operations.


The company’s Koppel and Ambridge, Pennsylvania facilities will be suspended effective March 31, 2020 while operations at its threading plant in Brookfield, Ohio will be suspensed starting April 17. 


The tubular pipes maker will also being laying off around 900 employees at its threading plant in Baytown, Texas and welded pipe plant in Hickman, Arkansas starting April 17. However, the company indicated it would provide some healthcare benefits to these workers for three months with a potential to extend them given the current COVID-19 situation. 


Luca Zanotti, president, Tenaris stated the need for lean operations to maintain a long-term solid position to serve customers.


In late November 2019, the oil country tubular goods (OCTG) manufacturer let go of 90-100 employees at its Blytheville, Arkansas site due to soft demand for energy tubular steel products. 


The US drilling industry has cut back spending on new drilling in the face of weak demand and lower prices on crude oil and natural gas. Last week, US energy firms cut the most oil rigs in a week in almost a year – mostly in the Permian basin, the country’s biggest oilfield. A cut in drilling trickles back to reduced demand of OCTG finished steel products. 


According to the latest Baker Hughes data published on Friday, total rig counts in North America declined 97 units compared to last week and are now at 870 units. Rig counts are 251 units lower compared to the same week last year. US rig count declined by 20 units to 722 in the US compared to a week ago and were down 244 units compared to the same week a year ago. Canadian rig counts declined by 77 units to 98 compared to a year ago but are trending seven units higher compared to a year ago. 


US oil rig counts declined by 19 during the week to 664 units and are lower by 160 units compared to the week a year ago. US natural gas rig counts declined by one unit to 106 units, down by 86 units compared to a year ago.


Canadian oil rigs decreased by 63 units to 52 units. Although, compared to the same week last year, the present oil rig count is three units higher. Canadian oil rigs decreased by 14 units to 46 units, lower by 10 compared to the same week last year. 

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