API steel sector positive despite global volatility

US-Israeli military action in Iran and the subsequent closure of the Strait of Hormuz has created an unprecedent disruption to Middle Eastern oil and gas supply. The resulting reduction in gas and oil shipments contributed significantly to an increase in the Brent crude oil price in the first three months of the year. Prices rose from a low of USD59 per barrel in January to over USD112 per barrel on March 20 before declining to around USD94 per barrel at the time of this report.

This has created renewed uncertainty across various industrial sectors, particularly investment in new line pipe projects. Investors are showing increased caution, delaying commitments due to rising costs and the possibility of future price corrections. In Europe, project delays are primarily linked to budgetary constraints. In the Middle East, many developments remain on hold due to the ongoing regional conflict.

US projects robust, European API prices rising

In contrast, MEPS’s research partners say that project activity in the United States remains particularly robust. Elevated oil prices, combined with supportive government policies, are driving momentum. US line pipe producers’ order books are full, creating opportunities for overseas suppliers to sell into the US market, despite the application of 50% Section 232 import tariffs.

European X60/X65 hot rolled plate selling values have increased during the first three months of 2026. Import offers from Asian API mills are uncompetitive due to CBAM taxes and volatile shipping costs resulting from the Middle East conflict. Supply from Europe’s API plate mills remains good but is expected to tighten in the second half of the year as orders are finally placed for some previously delayed large line pipe projects. Meanwhile, European suppliers of API hot rolled coil have successfully implemented cost-based price increases, partially reflecting rising energy costs.

In Asia, X60/X65 hot rolled plate prices have remained stable, quarter-on-quarter, with delivery lead times remaining short at four-to-eight weeks. Asian API producers continue to prioritise sales to the US market, where high selling values offer more attractive margins. However, European export opportunities are limited. The introduction of the EU’s emissions-based CBAM taxes from January 1, 2026, and the anticipated tightening of the European Commission’s tariff-rate quotas, from July 1, are expected to constrain Asian producers’ API coil and plate sales to European customers for the remainder of 2026.