The chief executive of struggling French steel pipes manufacturer Vallourec said demand from oil and gas majors was showing the “first signs of recovery” thanks to “booming” US shale.

The group, which produces tubes for the oil and gas industry, has been hit hard by the plunge in the oil price in 2014, which prompted energy companies to halt spending on new projects.

On Wednesday afternoon Vallourec reported a 22 per cent fall in revenue to €3bn and a net loss of €758m as capital expenditure continued to fall across the world.

Chief executive Philippe Crouzet told the FT that it has been an “extremely tough” year with an “unprecedented” drop off in demand

But he said that the worst might be over. As prices have stabilised over $50 a barrel there has been an improvement in the number of rigs being set up by smaller US shale players, he said.

“We see not seeing just a recovery [in the US]; it is a boom, an absolute boom,” he said.

Any pick up in demand coming from oil and gas majors investing in offshore platforms, however, would not benefit the group until “at least” 2018, he said.

Mr Crouzet also said that much of the hard work cutting jobs and production at Vallourec has already been done.

“At least we took advantage of the situation to reshape, downsize, streamline, in order to be well aligned to benefit from the recovery when it comes,” he said.

Vallourec last April announced plans to halve its European production capacity and raise about €1bn from selling equity. The company cut production in France, Germany and Scotland.

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