The U.S. Dept. of Commerce has imposed import duties of up to 31% on steel pipe from China, agreeing with a complaint filed by American producers and steelworkers that the imports were unfairly subsidized by China’s government.

The average duties on the pipe, used in oil and gas wells and known in the industry as oil-country tubular products, will be 21.3%, according to Commerce. Roughly $2.8 billion in Chinese steel pipe is imported annually, but industry analysts say that could fall off sharply, or even completely, because of the tariffs. That drop could help complainant U.S. Steel and other domestic producers rebound from a drop in demand following last year’s collapse in oil prices.

The pipe case, the largest countervailing duty complaint filed against Chinese-made products, was brought by the United Steelworkers union, U.S. Steel, the U.S. division of Evraz Group S.A. and Sharon, Pa.-based Wheatland Tube Co.

U.S. Commerce Dept adds pipe to list of stiff tariffs being imposed on Chinese imports.

A Washington, D.C.-based industry trade group and the Chinese government are protesting the pipe tariffs as protectionist and unfair. Eugene Patrone, director of the Consuming Industries Trade Action Coalition, Washington, D.C., says the tariffs will “hurt U.S. industries by raising their costs and making sources of supply uncertain,” as well as make oil and gas exploration and production more difficult.

In a statement to Xinhua, China’s official government news agency, a spokesman for China’s Ministry of Commerce said, “The U.S. used an incorrect method to define and calculate the subsidies, which has resulted in an artificially high subsidy rate.”