Crude oil is sliding

Crude oil is sliding.

Near 6:50 a.m. in New York, West Texas Intermediate crude oil futures were down more than 2%, and fell to as low as $US50.90 per barrel overnight.

Brent crude, the international benchmark, slipped nearly 2% to as low as $US56.76 per barrel.

The big news overnight was the nuclear deal agreement between Iran and several world powers — a development that oil watchers have been following closely because of what it may mean for the market.

The deal would primarily see Iran scale back its nuclear program in exchange for a lifting of international sanctions.

But what it means for oil prices is that Iran could start increasing its exports, adding to an already oversupplied market. Iranian Oil Minister Bijan Namdar Zanganeh estimates that Iran could send out up to 500,000 barrels a day, according to Bloomberg, and Goldman Sachs estimates it could take up to a year before output reaches this level.

On Monday, the 12-member cartel OPEC’s monthly report showed that Saudi Arabia pumped a record amount of oil last month.

Here’s a chart showing the slide in WTI overnight on Tuesday:

NOW WATCH: Take a tour of the $US367 million jet that will soon be called Air Force One

NOW WATCH: Money & Markets videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at