A novel planar pipe finite element conveying fluid with steady flow, suitable for modeling large deformations in the framework of the Bernoulli–Euler beam theory, is presented. The element is based on a third order planar beam finite element, introduced by Berzeri and Shabana (2000, “Development of Simple Models for the Elastic Forces in the Absolute Nodal Co-Ordinate Formulation,” J. Sound Vib., 235(4), pp. 539–565), applying the absolute nodal coordinate formulation. The equations of motion of the pipe finite element are derived using an extended version of Lagrange’s equations of the second kind taking into account the flow of fluid; in contrast, most derivations in the literature are based on Hamilton’s principle or the Newtonian approaches. The advantage of this element in comparison to classical large deformation beam elements, which are based on rotations, is the direct interpolation of position and directional derivatives, which simplifies the equations of motion considerably. As an advantage, Lagrange’s equations of the second kind offer a convenient connection for introducing fluids into multibody dynamic systems. Standard numerical examples show the convergence of the deformation for increasing number of elements. For a cantilever pipe, the critical flow velocities for increasing number of pipe elements are compared with existing works, based on Euler elastica beams and moving discrete masses. The results show good agreement with the reference solutions applying only a small number of pipe finite elements.