Escalating geopolitical tensions in the Middle East in 2026 have disrupted the Strait of Hormuz, keeping global oil prices volatile and accelerating changes in the energy landscape. Gulf countries are accelerating bypass pipeline projects, while Europe is diversifying supply. China is advancing its stabilizing oil and increasing gas strategy to maintain crude oil output at around 200 million tons annually.

As exploration expands into deep and ultra-deep resources and offshore projects enter the ultra-deepwater stage, demand for oil and gas steel pipes is shifting toward high-end products. China’s OCTG demand is expected to be 5 to 5.5 million tons in 2026, supported by increased drilling activity. Pipeline demand is also rising due to major gas projects and 30,000 km of urban network upgrades, with total demand projected at 6.8 to 8 million tons. Globally, demand for high-grade pipes is increasing, with the Middle East emerging as a key market, while China’s exports will depend on regional stability.