Oil price eased on Monday morning after rallying to 2-week high at $47/bbl last week. Currently hovering at around 45 level , the benchmark futures' performance should continue to be impacted by demand worries.

We do not have much important economic data until the US session but those to be released will reinforced the worsening condition. December's existing home sales is expected to have fallen further to 4.42M from 4.49M in the previous month while leading indicators probably dropped 0.3% mom in December after a plunge of 0.4% in November.

After the February contract expired, the contango structure, though it's still there, showed signs of narrowing. Moreover, spreads between WTI and Brent contract have also been shrunk. However, from the heavy stockpiling in Cushing last week, risk is on the downside for prices at the front end of the future curves. We expect WTI futures will trade within a range of 40-50 in the coming month.

OPEC has scheduled to have a meet on Mar 15 to discuss about supply situation. However, some members hinted a meeting before that may be necessary if Brent crude oil price trades below $40/bbl (March contract trades at 48.4 at this point). The cartel, which pumps around 40% of the world's oil, agreed to cut production by 2.2M bpd in December after oil price tumbled by 70% from July's peak at 147.27.

Gold price retreated to 890 level after rising above 900 Friday as the dollar strengthened further. The dollar rose to 1.293 and 1.364 against the euro and the pound. Last week, gold's rally was in fact against the norm that 'gold and the dollar are moving inversely' as rapidly deteriorating economic outlook increased the precious metal's appeal as safe haven. We believe current market condition should be able to hold up investment demand on gold and hence its price in the long term.

Platinum, currently trading at 955/960, will continue to be weighed on by contraction in the car industry. However, we believe price has found a trough at 756.9 in October and has currently entered the bottom-building process, which may persist for several months (until the auto industry shows signs of recovery), though.