Iran needs an oil price of $127 a barrel to balance its budget, amid increased spending needs among all oil producers, an influential Middle Eastern institute says.

The assessment suggests members of the Organization of Petroleum Exporting Countries are likely to push for higher prices, possibly by cutting back on overproduction.

In a report posted on its Website over the weekend, Arab Petroleum Investments Corp., which is owned by Arab oil producers, said the Islamic republic now needs an oil price of $127 a barrel for its budget to break even. That compares with the current market price of about $110 a barrel and is more than $20 a barrel higher than APIC said Iran needed two years ago.

Iran , which says it needs an oil price of only $85 a barrel to balance its budget, has faced a sharp drop in production and exports because of Western sanctions.

APIC's study also noted an increase in the average break-even oil price needed by OPEC as a whole for 2012, saying it now stands at $99 a barrel, compared with $77 two years ago.

For instance, Saudi Arabia 's break-even price is $94 a barrel, up from about $80 a barrel two years ago, according to APIC, after Arab uprisings elsewhere led the kingdom to boost spending. Saudi Arabia itself estimates it can cope with oil at $75 a barrel.

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