The talks between the Iran and the US regarding the nuclear power have been held over the telephone between the US President Barack Obama and Iranian President Hassan Rouhani on Friday cutting off the 25 years of impediment. Iran blamed to be using the nuclear powers to generate the nuclear weapons while Iran has defended it as the electricity generation source. The issues over nuclear testimony in Iran and Iran itself being away from the international banking networks, the US and EU sanction has made it difficult to export to the major oil importing countries like China, India, South Korea and Japan. The EU sanction prevents the Euro zone reinsurers to insure over the shipment carrying the Iranian oil while the US sanction accelerates the importing countries to reduce its imports year after year. This has reduced the supply of oil from Iran by 16%. Iran is the fourth largest oil producer in the world after Russia, Saudi Arabia and the US constituting 4.77% of the world oil supply. OPEC which accounts for the 81% of the total oil supplies, Iran holds on to the third largest oil producer producing around 13.1% around the region.

On Monday, the Russian President Vladimir Puttin approved the bill regarding the reduction of the tax on minerals exploration which supports to both the oil and gas industry. Russia is on a pace to extract the oil and gas at a constant level till the next decade as it has been pumping around 10.5 million barrel per day (mbd). It is likely to start the program from the next year.

The shutdown of the US government due to the budget impasse has hit over the job market. Around 1 million workers will be left on an unpaid leave. This reduction in the employment reduces the demand of the WTI thus reducing its prices. Also, the easing of the concerns regarding the Syrian war has held the steady flow of oil supplies.

The one way equilibrium of the demand and supply forces from their respective sectors is driving the equilibrium oil prices in the world. The demand most hit by geopolitical tensions, economic growth and growth expectations have supported on its edge whereas the new exploration of oil reserves, reduction in the export and import taxes have played  the major role on to the supply side.