Oil prices dive below $53 as Iran deal looms

[IceWizard]

Iran is nearing an historic nuclear deal with the
West -- and that's scaring the oil markets.

Oil prices plunged nearly 8% and broke below
$53 a barrel on Monday, the deepest plunge for crude oil since early February.

American drivers may have even lower prices
to smile about in the future, especially if an Iran
nuclear deal is in place by this week's deadline.

The national average gas price could return to
nearly $2 a gallon later this year, said Tom
Kloza, chief oil analyst at the Oil Price Information Service. The national average is
currently sitting at $2.77.

For now all eyes are on Iran, which has the
fourth biggest oil reserves in the world. A big
part of the nuclear deal is that the West will lift
sanctions on Iran, allowing it to increase its oil
exports.

That could be a game changer by deepening the oversupply of oil and sending prices down even further. "You could have a bunch of crude hitting the market in 2016 -- probably when it needs it least," said Kloza.

That's one reason why oil plummeted to $52.53 a barrel on Monday -- its lowest price since mid-April.

Prices were also hurt by more evidence
that OPEC hasn't been able to kill off American
shale oil production. Last week the number of
active drilling rigs in the U.S. rose for the first time since early December.

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