French seamless steel tube producer Vallourec reported an 18pct YoY increase in Middle East revenue during the first half of 2026, as resilient oil and gas investment in Saudi Arabia and the UAE offset logistical disruptions caused by the regional conflict. The Middle East became the company’s second-largest market, accounting for 23pct of total tube revenue, highlighting the region’s continued importance to Vallourec’s premium OCTG business.
The company said drilling activity across the Middle East softened during the first half of the year, mainly due to the impact of the conflict on operations. However, activity in Saudi Arabia and the UAE remained resilient, supported by ongoing strategic oil and gas developments. Vallourec added that premium seamless OCTG prices in the Middle East strengthened during the second quarter despite remaining broadly stable on a half-year basis.
Vallourec said disruptions to maritime traffic, including restrictions affecting the Strait of Hormuz, delayed deliveries to some customers in the region and required shipment rerouting. The impact was most evident in Iraq, Kuwait and Qatar, while the company’s established local footprint enabled it to maintain operations and customer service in Saudi Arabia and the UAE. Importantly, the company said it has not experienced any customer order cancellations and continues to actively manage its logistics network to minimize disruption.
The company noted that higher global oil and natural gas prices, driven by geopolitical tensions, continue to support upstream investment and demand for premium tubular products, although they have also increased manufacturing, logistics and transportation costs. Looking ahead, Vallourec said it will continue to monitor developments in the region and adjust operations if necessary should geopolitical disruptions persist.
For the first half of 2026, Vallourec reported revenue of USD 1.86 bln, down 8.2pct YoY, while EBITDA declined 3.6pct to USD 409 mln. The EBITDA margin improved to 22pct from 21pct a year earlier, supported by resilient pricing and product mix despite lower shipment volumes. Tube sales volumes declined to 515,000 tons in the first half of 2026 from 606,000 tons a year earlier, primarily reflecting weaker shipments to Europe and Asia. Despite the lower volumes, the Middle East remained Vallourec’s strongest-performing growth market, with regional revenue increasing 18pct YoY.
Vallourec is a global producer of premium seamless tubular products for the energy and industrial sectors, operating in more than 20 countries.