There are rumours among global gold miners to build a Gold-OPEC-like organization.


how it will affect the market ?


“Gold-OPEC” model !

We’ll make some assumptions and then estimate the potential price impact.


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Assumptions for the Simulation

1. Global Gold Production (2025 estimate): ~3,000 tonnes/year (~96.45 million ounces).


2. Top Gold Miners Coordinating Output: ~50% of production (~1,500 tonnes/year).


3. Production Cut: 20–30% reduction.

Low case: 20% → 300 tonnes withheld

High case: 30% → 450 tonnes withheld



4. Stockpiling Costs: Ignored for simplicity.


5. Gold Demand Elasticity: -0.1 (inelastic; 1% price increase reduces demand by 0.1%).


6. Current Gold Price (2025 avg): $2,000/oz.




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Step 1: Quantity Reduction Impact

Scenario Cut tonnes Cut ounces (1 tonne = 32,150 oz)

Low 300 9,645,000
High 450 14,467,500


Total market supply: ~96.45 million oz.

Low case reduction → ~10% supply reduction

High case reduction → ~15% supply reduction


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step 2 : see picture#1 attached


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Step 3: Observations

1. Even modest cuts (20–30%) could theoretically double or more the gold price due to inelastic demand.


2. Financial markets would likely react before full cuts take effect, partially pricing in scarcity.


3. If miners gradually release stockpiles, they can sustain higher prices over multiple years.


4. Risks:

Cheating by one miner could drastically reduce the effect.

Central banks or ETFs could counteract price increases.





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Step 4: Optional Extended Scenario !!

If miners also hedge a portion of stockpiles, they can lock in high prices while still having physical gold for future speculative sales. This could amplify profits without flooding the market.


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💡 Preliminary Conclusion:
A coordinated production cut by major gold miners could theoretically push prices to $4,000–$5,000/oz in this simplified model, assuming high compliance and inelastic demand. Real-world frictions, speculation, and political constraints would reduce the ultimate effect.


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