LONDON, Oct 25: Commodity markets dived this week, with oil hurtling towards $60 per barrel and gold ducking $700 an ounce as investors eyed a global recession that could hurt demand for raw materials.

Recession fears and uncertainty continue to haunt global markets, said Sucden analyst Nimit Khamar.

OIL: Crude oil prices hit 17-month lows as recession fears sparked renewed demand concerns, despite news that Opec will cut oil output by 1.5 million barrels per day.

Brent North Sea crude slumped to $61.00 per barrel, the lowest point since March 2007.New York’s light sweet crude tumbled to $62.65, which was last seen in May 2007.

Crude oil is heading lower again... on fears that the (Opec) cut might not be sufficient to compensate the shortfall of demand due to a global recession, said Dresdner Kleinwort analyst Peter Fertig.

The Organization of the Petroleum Exporting Countries (Opec) said Friday that they would slash output from November 1 in an attempt to stabilise plunging oil prices, despite a looming worldwide recession.

Analysts had expected Opec to cut its daily output by at least one million barrels per day as a global economic slowdown amid a worsening financial crisis slashes demand for energy.

In later trade on Friday, New York crude was $4.59 lower at $63.25 per barrel and Brent oil slid $4.30 to 61.62.

Global stock markets plunged on Friday, with London losing more than nine per cent as it struck a five-year low on news that Britain’s economy shrank in the third quarter, placing it perilously close to a recession.

Opec, which produces 40 per cent of world crude, announced a cut to production in a bid to support crude prices which have witnessed a dramatic collapse -- unprecedented in speed and magnitude, according to an official statement.

Crude futures in London and New York have plunged close to 60 per cent from record highs of above $147 a barrel reached only three months ago when supply concerns sent prices soaring.

The crude market was also dampened as the dollar strengthened against the euro and pound.

A stronger US unit tends to sap demand for dollar-priced commodities like crude oil and gold, which become more expensive for buyers holding weaker currencies.

The White House denounced what it called Opec’s “anti-market” decision to cut production, even though oil prices subsequently slumped on fears of a global recession.

The cartel’s president Chakib Khelil said the production cut would not hurt the global economy.

By Friday, New York’s main oil futures contract, light sweet crude for delivery in December, had tumbled to $63.16 per barrel from $79.96 for the November contract a week earlier.

Brent North Sea crude for December slumped to $62.62 , compared with $76.56 last week.

PRECIOUS METALS: Gold fell heavily on the strengthening dollar and recession-linked demand concerns, despite its reputation as a safe haven in times of economic turmoil.

The glamorous metal dipped as low as $682.41 per ounce on Friday -- last seen in September 2007 -- before clawing back ground.

Precious metals prices dropped sharply across the board on US dollar strength, said Barclays Capital analysts.

Capital Spreads managing director Simon Denham added: Gold continues to suffer in the blowtorch of recession, strong dollar and weakening inflation outlook. In times of high inflation, gold is regarded as a safe store of value.

On the London Bullion Market, gold dived to $712.50 an ounce at Friday’s late fixing from $784.50 a week earlier.

Silver retreated to $8.88 an ounce from $9.56 .

On the London Platinum and Palladium Market, platinum sank to $778 an ounce at the late fixing on Friday from $856 a week earlier.

Palladium dropped to $168 an ounce from $172.

BASE METALS: Base metals hit more multi-year lows as they fell sharply for a third week running.

A renewed slump in global equity markets this week indicates a protracted recession lies ahead, wrote Deutsche Bank analysts in a research note to clients.

We expect this will continue to pressure industrial metal prices lower. On our calculations, copper and lead remain the most overvalued commodities in the sector. By Friday, copper for delivery in three months had plunged to $3,770 per ton on the London Metal Exchange from $4,620 a week earlier.

Three-month aluminium dropped to $1,959.75 per ton from $2,185 .

Three-month lead slumped to $1,225 per ton from $1,415.

Three-month zinc fell to $1,169.80 per ton from $1,189.

Three-month tin slid to $11,300 per ton from $13,350.

Three-month nickel dived to $9,600 per ton from $10,400.

COCOA: Cocoa prices fell sharply in New York but held firm in London amid a farmers’ strike in key exporter Ivory Coast.

Apart from macroeconomic forces, which continue to heavily sway cocoa values, news from Ivory Coast continued to suggest a slowing of arrivals to ports as farmers continue to strike, said Sucden analyst Stephanie Garner.

By Friday on LIFFE, London’s futures exchange, the price of cocoa for December stood at 1,283 pounds per ton from 1,275 pounds a week earlier.

On the NYBOT, the December cocoa contract slumped to $1,867 per ton from $2,142.

COFFEE: Coffee prices also declined.

By Friday on LIFFE, Robusta for January delivery fell to $1,641 per ton from $1,779 a week earlier.

On the New York Board of Trade (NYBOT), Arabica for December delivery dipped to 107.80 US cents per pound from 114.05 cents.

SUGAR: Sugar prices fell in the wake of lower oil prices.

Sugar is used in the production of ethanol, a cheaper alternative to motor fuel which is refined from crude oil. When crude futures fall, demand for ethanol wanes.

By Friday on LIFFE, the price per ton of white sugar for December delivery slipped to 295.50 pounds from 323.20 pounds the previous week.

On NYBOT, the price of unrefined sugar for March delivery slid to 10.57 US cents per pound from 11.32 cents.

GRAINS AND SOYA: Grains and soya prices retreated further.

The main drivers really haven’t changed much: that is, the grain market primarily following the (US stock market), as well as the crude oil market and the US dollar, said Allendale analyst Joe Victor.

By Friday on the Chicago Board of Trade, maize for December delivery was down at $3.82 per bushel from $4.03 the previous week.

November-dated soyabean meal -- used in animal feed -- fell to $8.62 from $8.94.

Wheat for December delivery declined to $5.07 per bushel from $5.63.

RUBBER: Malaysian rubber prices slid.

A dealer with a rubber trading firm said the prices are expected to remain lower amid strong supplies but low demand.

On Friday, the Malaysian Rubber Board’s benchmark SMR20 fell to 164.85 cents per kilo from 169.45 cents per kilo a week earlier.—AFP