Oil prices tumble to new 12-year lows


London (AFP)

Oil prices slumped to fresh 12-year low points Friday, as dealers prepared for increased Iranian exports to the market against a backdrop of a global supply glut.

New York prices hit $29.39 a barrel, a level last seen in November 2003.

Brent meanwhile dropped to $29.45 -- the lowest level since February 2004.

Crude prices have shed three-quarters of the value in 18 months and dropped under $30 this week for the first time for 12 years.

But Michael McCarthy, chief market strategist at CMC Markets in Sydney, said prices may have hit or are nearing the end of their downward spiral.

"If we're not at the lows, we're very close to the lows for oil," he told AFP. "I do expect to see a turn very soon."

Oil prices have shed more than 15 percent already this year as investors worry about the prolonged oversupply crisis and weak global economic outlook, particularly in chief energy user China.

However, with major producer Iran poised to hike output after the lifting of Western-backed nuclear sanctions, some analysts have warned of further losses for crude.

The implementation of a deal between the two sides, allowing the removal of sanctions, is expected by Sunday.

At about 1230 GMT, Brent North Sea crude for delivery in March retreated $1.06, or 3.4 percent, to stand at $29.82 a barrel.

US benchmark West Texas Intermediate (WTI) for February delivery plunged $1.46, or 4.7 percent, to $29.74 compared with Thursday's close.