Oil prices tumble as Iran, global powers reach nuclear deal

LONDON (Reuters): Oil prices tumbled more than $1 on Tuesday after Iran and six global powers reached a landmark nuclear deal that would see an easing of sanctions against Tehran and a gradual increase in its oil exports.

The agreement, which capped more than a decade of on-off talks, was hailed by Iranian and Western diplomats as a “historic moment” that opens the way to a new phase in international relations.

Under the deal, sanctions imposed by the United States, European Union and United Nations would be lifted in exchange for curbs on Iran’s nuclear program.

There were no immediate details on how sanctions would be eased on oil.

Front-month Brent crude futures had dropped $1.15 to $56.70 a barrel by 0930 GMT. US crude was trading down $1.05 at $51.15 per barrel.

Analysts say it would take Iran many months to fully ramp up its export capacity following any easing of sanctions. But even a modest initial increase would be enough to pull international oil prices down further as the market is already producing around 2.5 million barrels per day above demand.