Just two weeks after OPEC abandoned its output ceiling, U.S. crude prices finally tumbled to the $35 per barrel mark.
West Texas Intermediate was trading at $35.53 per barrel around noon after falling to a low of $34.53 per barrel in early morning trading.
According to Retuers, the drop marks the lowest WTI crude price in 11 years.
Brent crude was trading at $37.52 per barrel at midday, about 43 percent less than year-to-date prices.
With Iran poised to ramp up its crude exports thanks to a sanction-ending deal with six global powers, OPEC production could surge by more than 1 million barrels per day.
Iranian crude exports have been restricted to about 1 million barrels per day since 2012, down from a high of 2.5 million barrels per day.
The country currently produces about 3.5 million barrels of crude per day, according to OPEC.
However, analysts remain split on how quickly more Iranian exports will hit the market.
“In addition to volumes released from storage, Iran will be able to increase crude oil and condensates exports by a maximum of 700,000 b/d by end-2016,” BMI Research said in a note seen by Reuters.
Even plummeting U.S. rig counts haven’t stopped the crude price free fall.
According to Baker Hughes, U.S. oil and gas drillers dropped 28 rigs last week and dragged the country’s total rig count down to 883 from 2,324 year ago.
While producers of all size have cut capital expenditures and staff levels since prices began falling last year, the reduced spends have not put a dent in global supplies.
In it’s latest oil market report the International Energy Agency warned that the global supply glut may persist into next year as global economic growth cools.
According to the agency, global oil supplies climbed past 97 million barrels per day in in October, as non-OPEC output recovered from lower levels in September.
Although demand growth rose to a five-year high of nearly 2 million barrels per day, strong OPEC production and resilient non-OPEC supply have pushed global crude stockpiles up to a record 3 billion barrels last month.
The IEA expects demand growth to ease closer to a long-term trend of 1.2 m million bpd in 2016 as “supportive factors that have recently fueled consumption are expected to fade.”