Oil prices reversed themselves and moved higher despite a historic nuclear deal that traders feared could flood the market with Iranian crude.
Under the landmark agreement, economic sanctions on Iran would be lifted in exchange for restrictions on its nuclear program. As a result, Iran will now be able to rejoin the world economic stage and export its goods – including oil.
Brent crude fell as much as 2 percent to hit $56.67 a barrel early on Tuesday in response, but later changed directions to $58.42, a gain of about 1 percent. West Texas Intermediate was up more than 1 percent at $52.86. Natural gas was down 1.2 percent.
Analysts said the swing in oil was due to the realization that Iran's crude won't be back on the market any time soon.
"There isn't going to be this great flood of pent-up supply hitting the market and it looks as if the process will be far more gradual than people expected," Neil Atkinson, head of analysis at head of analysis at Lloyd's List Intelligence, told CNBC by phone.