Expanding natural gas development in the U.S. is creating a demand for more "Oil Country Tubular Goods."  These OCTG tubular steel products are used in both wells and pipelines.

Here's a question, though: With demand for OCTG pipe rising, who will supply the steel products in question?

Domestic producers like U.S. Steel can meet the needs of U.S. oil exploration.  But as U.S. Steel Chief Executive John Surma explained at a conference in New York on Tuesday, a surge in imports of OCTG pipe could disrupt the U.S. market.

As Reuters' Matt Daily has reported, imports of steel pipe into the U.S. have jumped sharply in the first four months of 2012 compared to 2011. 

U.S. Steel's Surma sees this as a "case for major concern," with foreign companies potentially breaching global trade rules.

According to Reuters:

Steel imports into the United States jumped more than 17 percent to 2.7 million tonnes in April compared with a year earlier, according to the most recent government data.

U.S. import data showed overall steel imports have jumped nearly 28 percent so far this year, raising fears in the U.S. industry that the economic slowdown in China had prompted producers there to ship excess production to North America.

Subsidized Chinese steel imports bear watching as OCTG demand rises.  In Ohio, legislation (HB 559) has already been introduced that would require pipeline operators to report the country of origin and manufacture of the OCTG steel products being used for natural gas development. The Ohio Public Utility Commission and the Ohio General Assembly would then determine whether or not domestic steel pipe products are being utilized in the exploration and gathering of natural gas.

Read more about China's massive subsidies for its steel industry.