Oil prices higher in Asian trade

Easing concerns about the impact of the expected flood of Iranian supplies on the global market helped prices

Oil prices rose in Asia today on easing concerns about the impact of the expected flood of Iranian supplies on the global market following the country's historic nuclear deal.

US benchmark West Texas Intermediate for August delivery rose 26 cents to $53.29 and Brent crude for August climbed 10 cents to $58.61 a barrel in late morning trade.

Oil prices initially tumbled yesterday after negotiators from Iran and major world powers announced they had reached a deal to monitor Tehran's nuclear programme, which the West says will curb its efforts to build a nuclear bomb.

Iran's compliance with the terms of the agreement will lead to a lifting of crippling western economic sanctions which have restricted its key oil exports.

But prices eventually settled higher yesterday as investors were confident it would take time for Iran to start exporting more crude to a market already awash with supplies.

"Iran's oil and financial sanctions will be lifted with a phased deal struck on its nuclear programme on July 14, but the market won't immediately see more crude," leading global energy information provider Platts said in a commentary on its website.

"The market probably won't see any noticeable increase in Iranian crude supply until next year," it said.

Iran is currently exporting around one million barrels per day of crude, sharply down from the 2.2-2.3 million it was selling overseas before the sanctions were imposed in mid-2012, according to Platts.

Daniel Ang, an investment analyst with Phillip Futures in Singapore, said the impact of the Iran deal on the market will depend on how fast Iran starts selling more oil.