WTI $71.91 +$1.61, Brent $73.79 +$1.56, Diff -$1.88 -5c, NG $4.00 +4c, UKNG 88.69p -0.8p

Oil price

After the shenanigans earlier in the week if nothing changes from current prices oil will have a flat week, not bad given the panic on Monday especially if some of the thicker traders got carried out, some will never learn though. Worth looking at NG though, it has broken through the $4 level and seems, like in Europe to be very strong.

There is no change from me on oil prices, I still think that 2H demand will exceed forecasts, draw stocks and create further tightness in the market. I still believe that it is foolish to bet against the KSA right now especially as Russia isn’t increasing production nor are any other suspects and that traders will buy back the long position that they sold off in recent weeks. I still believe that the huge capex cuts made primarily by the super majors in 2020 has created a structural shortage in the short to medium term, a shortage that will be exacerbated when the rest of the world catches up with the vaccination programme and will probably lead to demand numbers being raised for 2022. Overall the draw on Opec+ will carry on for longer than the market expects and even if the Biden regime kneels to the Iranian nuclear build-up as expected given that the know-it-all John Kerry is involved it will, they are already managing to sell quite a lot of oil into the markets.

Block Energy

A corporate governance issue seems to be rearing its head at Block in recent weeks. I commented a few weeks ago that after a significant AGM vote against the Chairman, that a 303 notice has been called for another meeting in order to force him out. But there are some very odd movements going on in the ranks of the NED’s with two leaving the firm this week alone.

Chris Brown left the board yesterday and whilst he may continue as a consultant that means he avoids the commitment that being a director involves. Today Dato Sandroshvili announced his resignation from the board ‘with immediate effect’ which no one likes to see especially now the board appears short of independent advice and that he was only appointed to the board in December 2020 with his ‘wealth of local expertise’ being important according to the Chairman.

I’m no corporate governance expert but right now Block only has 2 NED’s, including the Chairman who is not independent and I thought that the recommendation  from the QCA was  that there should be at least two independent directors on the board. At a time when the Chairman is facing a 303 to remove him, the level of corporate governance should be whiter than white, right now it looks distinctly grey…I suspect that there is more to come on this story.

And finally…

The Olympic Games in Tokyo start today, after the Covid trauma in recent months and with Japan having not troubled the scorers in terms of vaccinations there will be no crowds to watch the events nor even as many contestants who are falling like flies.

The Hundred started last night and The Oval Invincibles narrowly beat the Manchester Originals with only a  couple of balls to spare, the competition continues over the weekend,

Tomorrow sees the first test between The British & Irish Lions at 1700 hrs, just to ensure that they have the edge SA has appointed a local as TMO for all three games, watch this space…

And  one of the great races is tomorrow as Ascot hosts the King George V1 and Queen Elizabeth Stakes.