The price of a barrel of benchmark European crude oil, known as Brent, fell after the deal was announced but quickly jumped back into positive territory on Monday. Late in the trading day, a barrel of Brent was going for $58.15 US, up 30 cents on the day.
Analysts interviewed by CBC News for this story say a deal that will see more Iranian oil come online won't necessarily lead to lower prices in the short term.
"The agreement is not synonymous with the immediate opening [of] the country's oil floodgates," wrote Harry Tchilingurian, head of commodity markets at BNP Paribas in a report. "We are not out of the woods just yet when it comes to the lifting of sanctions on Iran's oil sector and exports."
The key hurdle for increased Iranian oil exports is in the U.S., where Congress must ratify the deal in the next 60 days. The accord is strongly opposed by key members of the Republican party, but President Barack Obama has already vowed to veto any legislation that would block the deal.
Before economic sanctions on Iran are lifted, the International Atomic Energy Agency also has to verify that Iran is holding up its end of the deal. That report is expected in mid-December, according to the IEAE's roadmap, meaning economic sanctions likely won't be lifted until the end of the year, at the earliest.
How much oil does Iran have?
As of June, Iran produced about 2.8 million barrels of crude oil per day and exported 1.1 million barrels per day, about half of what it exported before the last round of economic sanctions in 2012, according to BNP Paribas. Iran is estimated to hold 30 million barrels of crude oil and oil condensate in offshore storage tankers, said BNP Paribas, but would likely sell that oil off over a period of two to three months if sanctions are lifted.
If all sanctions end in 2016, no one knows exactly how much more crude oil would enter the market. A plurality of oil market analysts surveyed by Bloomberg Intelligence in May believed that 500 to 749 thousand barrels per day could be added to global oil supply. The International Energy Agency expects world oil demand to be 94.4 million barrels per day in the first quarter of 2016.
After Iran sells off its oil reserves, the country faces another challenge.
"In order to get to their potential or back to their pre-sanctions output level, a lot of investment is needed," said Dina Ignjatovic, an economist with TD Bank.
Much of that investment would have to come from outside Iran. A number of major global oil companies left the country in the face of economic sanctions, but many have expressed interest in returning to Iran should sanctions be lifted.
European and Asian oil companies are likely to return to Iran first, said Jamie Webster, senior director at IHS Energy Insight, but U.S. firms will likely take longer due to U.S. economic sanctions.
What does deal mean for Canada?
The deal with Iran could ultimately be bad news for the Canadian oil industry.
"Any way you look at it, this deal is bearish for oil prices in the near term," said Judith Dwarkin, chief energy economist with ITG Investment Research. "There's just no way you can put lipstick on that pig."
In the long term, the deal "means that prices will not recover as fast as some may have hoped in 2016," wrote Martin King of FirstEnergy Capital in an email to CBC News.
The Canadian energy industry "will just deal with the low prices as they always have done: by containing costs, improving efficiency, and attempt to expand markets where possible," wrote King.
Alberta Premier Rachel Notley acknowledged that rejuvenated Iranian oil exports could have "a bit of a suppressing effect on oil prices for a period of time."
"Like many Albertans, we talk about oil prices much like we talk about weather. And in both cases, we're used to change," said Notley in a teleconference call from Quebec City.