MoneyShow's Jim Jubak discusses what he thinks are the two big issues regarding the proposed deal with Iran and what it may mean for oil prices.

There are two big issues about negotiations for a deal to limit or end the Iranian nuclear program and Hermo sanctions. One is whether these negotiations will succeed and whether there will be an agreement signed and all that. We probably won't know that until June. The other issue is how fast will Iranian production resume start rising again after this deal is signed.

Predictions for this are all over the place, but, basically, you're looking at a situation where sanctions have cut Iranian oil spurts down to about 1.1 million barrels a day. That's about half of what it was before sanctions.

The question is how fast that 1 million barrels a day can go back into the global oil supply system. If you remember, we're seeing weakness in oil prices because we've got about a 2 million barrel a day surplus on the supply side, so adding that million barrels back in would take a surplus of 2 million up to 3 million. That would be a big increase. How fast can Iranian oil get back in the market?

There are people who think that within say three to six months, the Iranians could get about 500,000 a day back into the export stream with the idea that maybe by the end of the year it would be back to 700,000. There are people who say it's going to be 2016 before we see any increase in Iranian oil exports because the Iranian industry is in just such bad shape.

The big, sort of, elephant in the room, if you will, is that Iran has been stockpiling oil. They've got about 20 million barrels in storage right now. It wouldn't take that much to get that out of storage into the world export stream.

Even if the oil industry is not in great shape, it would take some time to get investment going and then get some of the fields back to shape and replacing equipment, you've still got that 20 million barrels sitting there.

My guess is that what you're going to see is people saying, “Well, with West Texas intermediate at $53 a barrel—which is where it was on April 7—it probably makes sense to put a short on here on oil prices to protect myself to the downside—just in case Iranian production really does start to get back online and Iranian exports go up—so, my guess is that as we get closer and closer to a deal, even if we're not seeing any actual Iranian oil enter the supply chain, we are going to see oil prices start to react to the possibility that they will.