Oil prices hit 12 year low

Qatar has joined Gulf states by increasing prices of petrol at pumps by 30 percent or more.

Oil-reliant Gulf economies have suffered huge losses over the past year as oil prices continue to fall, forcing Saudi Arabia, Oman and others to cut subsidies on domestic petrol supplies.
 
It comes as oil prices fell to a 12-year low as markets prepare for increased Iranian exports worsening a global glut for oil-producing states.

Trade in New York dropped to $29.39 a barrel, a price last seen in 2003.

London Brent fell to $29.45, the lowest level since February 2004.

Crude prices dropped under $30 this week for the first time for 12 years.

Meanwhile, the motoring group the RAC has said that falling oil prices could make petrol cheaper than water in the UK. 

However, despite fears that prices could drop less than $20 a barrel, some analysts believe this may be the end of the downward spiral.

"If we're not at the lows, we're very close to the lows for oil. I do expect to see a turn very soon," Michael McCarthy, chief market strategist at CMC Markets, told AFP.

So far this year, prices have dropped 15 percent sparking fears about prolonged oversupply crisis and weak global economic outlook, particularly in chief energy user China.

With Iran looked to pump out more oil when Western-backed sanctions end some analysts have warned the price could drop further.

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

Record deficits for oil-producing Arab Gulf states last year has forced more conservative budgets for 2016.

On Friday, three state-owned companies in Oman said they would offer shares.

It comes as a number of state-owned firms in the Gulf look set to be privatised providing new cash supplies for governments.