WTI $49.10 -23c, Brent $49.89 -47c, Diff -$0.79 +80c, NG $2.29 +12c

Oil price

There are no medals for taking big positions in the market just before an Opec meeting and yesterday proved that. July Brent expired and the August contract attempted to stay above $50 but in the end dived below the key level pleasing the technical bears. In the real world it was all rather same old, same old as Canada continued to build production and Nigeria cut back some more. The EIA tried to inject some interest by saying that US production had fallen again in March to 9.127m b/d but that didnt cut any ice either. I read the statement from Jaguar Land Rover with some interest, apparently sales in China recovered sharply, rising by 19% in the quarter with the CEO saying that ‘China is really coming back’ which is most interesting.

Opec tomorrow should be a two pony show, representing the KSA for the first time, Khalid al-Falih will not give anything away and neither will Iran as for them it is effectively the first without sanctions. As usual in these circumstances everyone who is able to increase production ahead of the meeting does, this rather macho behaviour goes back to the time of quotas when one adhered to them in name only. I remain convinced that Opec as a big group is effectively defunct and that the Gulf states under the auspices of the KSA will control policy for as long as they are still talking to each other…

My comments ahead of the Opec meeting, in an interview I did with Jeremy Naylor of IGTV this morning are in this link.

https://www.ig.com/uk/market-insight-videos?bctid=4922348527001&bclid=3671160850001

Lamprell

Lamprell has signed a JDA with Saudi Aramco, Bahri and Hyundai Heavy Industries to follow up the MOU that they signed in January. Work continues on the feasibility of a maritime yard at Ras Al Khair in Eastern Saudi Arabia which, if it goes ahead, will provide engineering, manufacturing and repairs for rigs, commercial vessels and offshore service vessels. With a FID ‘in due course’ investors should not get over-excited about this providing anything anytime soon but it is an important step towards Lamprell moving away from its core business in Abu Dhabi and should be seen as such. No recent news on trading which will likely be subdued as the company shares the sector’s malaise but I remain confident that Jim Moffat will continue to deliver in a difficult market.

Sundry

Genel has announced that payment has been received with regard to Tawke production and that they have had not only their monthly allocation but also some back payments. With the Taq Taq payments also announced it looks like April wasnt quite as bad as it had seemed.

Pantheon has announced that the VOS#1 well in Tyler County is ready to go with all work completed ahead of the fraccing which will start imminently. Apparently there has been a short delay due to permitting and the bad weather.

As the calendar ticks over and as mentioned by the company last week Xcite Energy has $135m of bonds that mature at the end of this month. The company stated that it had enough in escrow to pay the coupon but not repay the bond and is in discussion with its leading bondholders to finance both long and short term funding requirements.

And finally…

So Woy eventually went with Rashford and Sturridge and will leave Drinkwater and Townsend at home which is rather a shame. I suppose he was keen to ensure that the medical team will have something to do from the start looking after his walking wounded, something I thought we were never going to do again…

Muzza didnt get on court yesterday neither did many others as Paris shared our bad weather, hoping for some action today.

And with the news that professional boxers will be allowed to take part in the Olympics I suppose we say goodbye to amateur boxing…