Pressure Mounts in the Oil Industry: It’s Time to Take Action

The effects of inflation have finally begun to ease off in the oil industry and OCTG pricing, with the latest CPI showing a 2.7% year-over-year rise, a small jump from 2.4% in May. While this may seem like good progress on the surface, anyone buying pipe knows that pipe inputs don’t follow the same script as everyone else. 

The pressure is real, which is why we aren’t seeing capital fly back into the field. Interest rates are still holding at 7.5%, which hold capital hostage and reinforce the same operational posture we’ve seen for months: lean rig programs, DUC completions, and no long-cycle commitments. While federal may talk about cuts, inflation linked to tariffs is expected to rise again into Q4, pushing potential rate relief even further out. 

Demand may feel stable, but it isn’t secure. The EIA still projects modest oil growth globally, but the equation is fragile. There’s more supply than demand and more risk than reward. Natural gas prices have slipped nearly 10% in the last 30 days, with Henry Hub at $3.43 and the 12-month strip sitting around $4.13. If you’re betting your Q4 plan on market stability, you should be ready for a difficult road ahead. 

The Rig Count Rises

While everything else looks troubled, the rig count has finally gone up. After 12 weeks of steady declines, the U.S. land rig count jumped to 544, up 7 rigs overall. This isn’t a complete trend reversal yet, as oil rigs were actually down 2, while gas rigs gained 9, but it is a signal of potentially good signs on the horizon. Completion activity remains steady with 176 active frac spreads, which tells us capital discipline is still king. 

Meanwhile, steel pricing refuses to blink, with the HRC holding in the $875-890/ton range, up over 30% from this time last year. Collar pricing is up again too, and finishing timelines are staying long. There’s no cause to panic yet, but the pressure is mounting. As we dive deeper into Q3, that pressure will only get tighter, so be prepared for what’s to come. 

OCTG Pricing Tension Increases

The current OCTG pricing reflects the rising tension. This week stands at: 

• Shallow Conventional: $1,700/ton

• J55 API: $1,350/ton

• L80 API: $1,950/ton

• P110 API: $2,050/ton

• P110 Semi-Premium: $2,150/ton

• P110 Premium Wedges & GT: $2,450/ton

These numbers are holding for now, but the runway is shortening, especially when you consider what the future has in store. All eyes are on the upcoming August 1st tariff decision. Trump-led negotiations may result in reduced tariffs on incoming steel, but the Treasury has already confirmed that there will be no refunds for material that’s already landed. This unfortunately means we are looking at a two-tiered pipe market. 

Some inventory, which is already here and taxed, will carry full weight. Newer inventory (if the decision favors relief) could arrive cheaper, but not faster. Lead times are still long and nobody is snapping their fingers for customs clearance. 

Additionally, there’s the hidden landmine of year-end ad valorem tax in Harris County. The 2.5% tax on inventory held December 31 is already pushing distributors to clear yards early. You’ll see it hit hardest in Q4 as less material, fewer options, and no late-season bailouts begin to take their toll. If your project needs pipe in Q4 or early Q1, you’d better book it now because once those inventory levels drop, the market will be unforgiving. 

As always, politics are constantly shifting. Trump continues to double down on steel protectionism and energy dominance. Chris Wright (Liberty Energy) is keeping the pressure on the U.S. to lead the charge in oil and gas, backed by hard assets instead of sentiment. The energy narrative is changing, but don’t confuse policy momentum with supply chain readiness. 

Where to Go From Here?

1. Lock in now: Pipe pricing is holding, but not for long. And landed goods give you predictability in an unpredictable world.

2. Expect a pricing split: Tariff relief may only impact future inventory. You’ll either pay more or wait longer.

3. Avoid Q4 chaos: Distributors are already clearing inventory to dodge the Harris County tax.

4. Add buffer: Services like heat treat and finishing aren’t speeding up anytime soon.

5. Use Speartip as your recon team: We’re watching rig counts, tariffs, steel, policy, and the full OCTG terrain so you can move decisively, not reactively.

Final Words

Inflation might be cooling. Steel isn’t.

The rig count moved, but not far. Tariff pressure is mounting. Year-end inventory is already in retreat.

If you're waiting for perfect conditions, you’ll miss your window.

At Speartip, we don’t wait. We move first. We move fast, and we move with intelligence.

We’ve got your six. Let’s move.

—

Ryan Hunt

Founder & CEO, Speartip Tubular

"We move as one. And we move fast."