A nuclear deal between Iran and world powers has blunted Israel's military threats against Teheran, but the Jewish state can still exert pressure on its archfoe through diplomatic and intelligence means, analysts say.

Iran agreed to curb its nuclear program for the next six months in exchange for limited sanctions relief following marathon talks with the five permanent members of the UN Security Council plus Germany in Geneva that ended on Sunday.

Meanwhile, oil prices fell on Monday, and world shares were buoyed higher after the deal was sealed.

Brent crude, a benchmark for world oil prices, shed more than $2 a barrel, its biggest drop in more than three weeks, to trade around $108.70, although the deal won't allow Iran to increase oil sales for six months.

"It's positive news; it's clearly boosting equity markets today, and in a broader sense, its reflationary for the global economy," said Mike Ingram, market commentator at BGC Partners.

Mohammad Javad Zarif, Iranian foreign minister, has become a national hero

Western countries accuse Iran of seeking to build a nuclear weapon, a charge Teheran has long denied.

Experts say the Geneva deal has taken the military option against Iran off the table, at least for the six-month negotiating period.

"As long as the international community is moving into this six-month period where there's supposed to be a negotiated comprehensive deal, it's hard to believe Israel would take action," said Emily Landau of Tel Aviv University's Institute for National Security Studies. Yoel Guzansky, former Iran analyst at the Israeli prime minister's office and a research fellow at INSS, agreed.

"Israel's options are now few and limited," Guzansky said.

"Netanyahu has said a nuclear agreement is not binding for Israel, which reserves the right to defend itself by itself.

"But the real chances of (a military strike) happening after an agreement which effectively sides the entire international community with Iran are significantly less than they were yesterday," he said.

"The fact an agreement was signed between Iran and the P5+1 countries will make it hard for Israel to act on its own."

However, this does not leave Israel with no options whatsoever, since the interim deal paves the way for further negotiations whose success remains to be seen.

"In terms of (US President Barack) Obama's project of putting time on the clock and not allowing the Iranians to move forward with their nuclear program during the months of negotiations, the deal is more or less something that can be lived with" for the Israelis, Landau said.

AFP-Reuters