New York (AFP) - Oil prices plunged to fresh 12-year lows Friday and dragged down stock markets as dealers prepared for increased Iranian exports to the heavily oversupplied market.

Capping another week of steep losses, prices for the key global benchmarks dropped. Brent North Sea crude fell seven percent in London and West Texas Intermediate in New York lost about six percent on Friday.

That took losses since the beginning of the year to more than 21 percent, one of the steepest declines in years.

Traders were still at a loss to peg where the bottom will be after the market collapse began 18 months ago, wiping more than 70 percent from crude prices.

In London trade, the Brent contract for March delivery closed at $28.94 a barrel Friday, a loss of $2.09 from Thursday to the lowest level since February 2004.

New York prices for WTI for February delivery hit $29.13 a barrel before rebounding to end at $29.42 a barrel, down $1.78.

The accelerating losses this week came on the back of key oil importer China's economic slowdown and expectations that Iran will quickly begin exporting large amounts of crude when nuclear sanctions are removed, possibly early next week, and possibly Sunday.

"That's going to put 500,000 barrels per day more on the market," said James Williams of WTRG Economics.

"Soon India or someone in Europe is going to purchase that oil," carving into other exporters' markets, he said.

"And there's no indication the Saudis are going to back off on their production."

Capital Economics analyst Caroline Bain said Friday that disappointing US economic data also added to the selling pressure.

"Weak US industrial and retail data, published today, further weighed on prices. By far the largest loser was the price of oil, which also faces the prospect of a surge in supply if Western sanctions on Iran are lifted this weekend," she said.

The continued plunge in prices, with some analysts now seeing a $20 price in sight, has spurred turmoil in exporters as revenues collapse.

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Nigerian petroleum resources minister Emmanuel Ibe Kachikwu this week declared that he expects an extraordinary meeting of the OPEC oil cartel in "early March" to discuss nosediving crude prices.

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."