By Claudia Carpenter and Rachel Graham Oct. 24 (Bloomberg) -- Crude oil, copper and gold led a drop in commodities, extending a record quarterly decline, on expectations an economic slump will sap demand for raw materials. Oil is heading for its fourth weekly retreat and gold, copper and lead their worst weeks in at least two decades. The S&P GSCI index of 24 raw materials has dropped 9.5 percent since Oct. 17, adding to a third-quarter drop of 28 percent, the gauge's worst-ever performance. Global equity markets also fell. ``Selling is across all asset classes,'' said Robin Bhar, a commodities analyst at Calyon in London. ``A month ago we were on the edge of a cliff and now we're in freefall.'' The U.K. economy shrank more than forecast in the third quarter, suggesting the nation may be in its first recession since 1991. The International Monetary Fund said Oct. 8 the world's advanced economies will next year grow at the slowest pace since 1982. Oil for December delivery dropped as much as $4.79, or 7.1 percent, to $63.05 a barrel on the New York Mercantile Exchange and was at $64.58 a barrel at 10:26 a.m. London time. The Organization of Petroleum Exporting Countries agreed to cut oil production for the first time in almost two years to stem a collapse in prices. Oil ministers of the 13 OPEC nations decided to reduce supply by 1.5 million barrels a day from November, ministers said today as they left a meeting at the group's Vienna headquarters. ``The market expected a cut of 1 to 1.5 million barrels a day, and it got it,'' said Mike Wittner, London-based head of oil-market research at Societe Generale SA. ``This was already priced in.'' Lead Plunges Lead, used in car batteries, declined 18 percent this week, with all industrial metals on the London Metal Exchange falling in the period. Toyota Motor Corp., the world's second-largest automaker, reported its first drop in quarterly sales in seven years. Volvo AB, the second-biggest heavy-truck maker, expects a 10 percent decline in the North American market this year. ``The most important factors for industrial metals are construction and auto manufacturing and those two have been hit,'' Commerzbank AG analyst Eugen Weinberg said in Frankfurt. A car contains about 300 pounds (130 kilograms) of aluminum, according to Commerzbank. Lead for three-month delivery fell $113 to $1,174 a metric ton on the LME, for a weekly drop of 18 percent. Aluminum tumbled $37, or 1.8 percent, to $1,970 a ton, or an 11 percent drop for the week, the most since May 19, 2006. Copper declined every day this week, pulling prices down 21 percent. ``Confidence is at rock bottom; no one wants to be long any commodity,'' Jamie Craggy, a dealer at One Financial, an online commodities brokerage, said by phone from London. Steepest Decline Gold headed for its steepest weekly decline in more than a quarter-century in London as the rising dollar curbed investor demand for the precious metal. Investment in the SPDR Gold Trust, the biggest exchange-traded fund backed by bullion, has stalled after reaching a record 770.6 tons on Oct. 10. Holdings fell to 747.1 metric tons yesterday. ``Any financial market movements are being interpreted as bearish for precious metals,'' Walter de Wet, an analyst at Standard Bank Ltd. in Johannesburg, wrote in a note today. ``The worst culprit is the greenback.'' Gold for immediate delivery fell $34, or 4.7 percent, to $687.45 an ounce as of 10:05 a.m. in London. Platinum retreated $32.25, or 4 percent, to $778.25 an ounce. Among other commodities, palm oil futures in Kuala Lumpur slumped as much as 12 percent to the lowest in more than three years. Corn and soybeans traded in Chicago headed for a fourth weekly drop on concern that the economic slump will reduce demand for oil, raw materials, food and livestock feed. To contact the reporter on this story: Claudia Carpenter in London at ccarpenter2@bloomberg.net or ccarpenter2@bloomberg.net; Rachel Graham in London rgraham13@bloomberg.net

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