OPEC’s oil basket price drops to $25 a barrel

And it claims that it will produce 500,000 additional barrels of oil per day once the sanctions are lifted, rising to an extra one million barrels before the end of the year.

The country said it intends to increase production by 500,000 barrels per day in the coming months, likely pushing global prices lower in the short term.

According to analysts at Commerzbank, Tehran could resort to a progressive production increase to limit the pessure on oil prices, a view supported by the president of the National Iranian Oil Company.

The Organization of the Petroleum Exporting Countries (OPEC) made a decision to keep crude production pumping at current level in the already oversupplied market. The cartel’s output is accounted for around 40 percent of the global crude output.

OPEC said the price of a basket of crudes produced by its 13 members was assessed at $25.69 on January 13.

Global oil prices are hovering near 12-year lows as the market braces for a surge of Iranian oil exports once worldwide sanctions are lifted, possibly within days. With selling its oil to lower prices Iran is seeking to attract more customers.

“We don’t necessarily have to compete in price” said the head of Iran’s oil exporters union Hamid Hosseini. They ignored Tehran’s repeated calls to cut export quota, which stands at 30 million barrels per day.

Nevertheless, Assali emphasized that Iran will proceed with the planned increases in its oil production by taking care not to push down the prices further, IRNA reported in a story that was also covered by Reuters.

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

He reiterated his stance that the industry “will get out of this mess”, and said he expected a higher oil price later this year. At present there is about 250.000 bpd of oil, and there is more production over consumption.

Russian Federation has steadily ignored similar calls in the past, saying that its climate would make it hard to quickly restart production once wells have been closed off. It’s holding firm this time around too- pointing out that no other oil producer is planning cutbacks.

He said that the market should be allowed to rebalance itself based on supply and demand, which should also be OPEC’s strategy.

Oil prices saw their second consecutive day of gains thanks to China’s stock market rebound on Thursday. More productions would be in favor of consumers. “Commodity prices struggled again [last] week, in large part owing to further declines in Chinese equities which in turn fuelled concerns about the country’s growth prospects”, Capital Economics analyst Caroline Bain wrote in a note to clients on Friday.