Paper: SHOULD API SUCKER RODS AND COUPLINGS BE CONSIDERED AS COMMODITIES

Commodities are defined relative to their application. There are dictionary definitions of the word commodity. There also are definitions of commodities related to the specific good or service that is being considered or traded on one of the many financial boards in the world. For these commodities, there is a "benchmark" that has been defined, standardized, and accepted for base price determination. However, there are multipliers that are used to differentiate the products that exceed or do not meet the benchmark requirements. This paper will discuss commodities and related benchmarks along with providing information related to the API Specification 11B and its requirements for standard sucker rods and couplings. Additionally, specific requirements in the standard are highlighted that provide quality and performance expectations but show dependency on the manufacturers" internal controls or procedures. Also discussed is that the oil and gas industry have not developed a benchmark for sucker rods and couplings (as well as many "standard" products) since each manufacture does not us
the same, standard processes and procedures. Thus, procurement/purchasing organizations should consider all the manufacturing processes and procedures to compare the equipment produced and not try to compare these products on price alone.