Crude oil prices fell and USD declined on profit-taking, as the market lost confidence of an OPEC output cut. The front-month WTI crude contract fell -4.23%, losing for the first time in 7 weeks. The Brent crude contract also plunged -4%. Both benchmarks settled below US$50/bbl for the week.
Precious metals were higher during the week, Gold and Silver accumulating gains of 2.15% and +2.52% respectively. A prolonged period of negative real yields should remain supportive for all precious metals.
OPEC and non-OPEC are gathering, hoping for a deal to be reached. OPEC proposed to achieve a production range of 32.5 – 33M bpd. If exemptions are granted for Iran, Libya, Nigeria (and Iraq?), countries such as Saudi Arabia, Qatar and Russia would have to cut output for achieving the production goal. The countries required to cut more may eventually refuse to collaborate.