MRC Global InSight

Hope for Recovery

Thank you for trusting MRC Global with your business.
Together with you, we look forward to the hope of recovery and an improving energy outlook.

 

When we published our last issue of InSight in September 2020, the world was still facing a dramatically lower demand for energy products due to historically low oil prices and the paralyzing effect of COVID-19 on business and travel. Energy companies reacted by postponing or canceling projects and turnarounds, cutting their overall capital expenditures (CAPEX) for the year and, in many cases, downsizing and restructuring their operations. In turn, the global demand for pipe, valve and fitting (PVF) products and services suffered considerably.

As we move further into this new year, we are more optimistic about the future. Oil prices are finally returning to pre-pandemic levels after the collapse in 2020, which was driven in part by the price war between Saudi Arabia and Russia. OPEC Plus (members of the Organization of Petroleum Exporting Countries and its allies) recently agreed to maintain current production quotas, at least for now, with only some modest exceptions. COVID-19 vaccine rollout programs are starting to take shape around the world.

The rate of recovery will depend on any further surges in pandemic infections, the pace of the global vaccine rollout and any new COVID-19 variants that may not be susceptible to vaccines. Yet, even with these variables, there is a revival in the pulse of the energy industry. Successful vaccine programs are in place, and the numbers of partially or fully vaccinated individuals are steadily climbing.1 As the pace continues upward, economic and travel activity should improve, creating an increased demand for oil. This recovery may look different than prior cycles, as operators approach future returns and growing production with more discipline, but we see the pendulum beginning to swing in a more positive direction.

As your leading PVF distributor, MRC Global is working alongside our customers and suppliers to meet the challenges of the current environment. Together, we are part of a critical supply chain delivering energy to the world. At MRC Global, we are committed to doing our part - overcoming supply constraints with our extensive inventory, working with our transportation providers to deliver orders safely, in full and on time, and investing in technology to remotely service order requirements. While market conditions over the last year have reshaped our industry and changed the way we do business, we remain committed to you, and to the core values our company was founded on 100 years ago.

1. Our World in Data: www.ourworldindata.com/covid-vaccinations. Accessed April 15, 2021.

Jack McCarthy

Senior Vice President
Supply Chain

Rance Long

Senior Vice President
Business Development

John Bowhay

Senior Vice President
International Operations & Global VAMI