While Iran's exports have moved in Trump's favor, the president faces the predicament of wanting oil prices to come down before US midterm elections on November 6. Earlier this month, Saudi shipments into the US reached a four-week average of 1 million barrels a day for the first time since late 2017, according to government data.
The supply concerns outweighed an increase in oil inventories in the United States reported late on Tuesday.
The longer-term outlook remains weighed down, however, by an escalation in the China-U.S. trade war that has clouded the outlook for crude demand.
Data from the InterContinental Exchange shows open interest in calls that give the owner the right to buy Brent futures at $80 and $85 by next week grew by almost 45 per cent on Monday and Tuesday to an equivalent of 54 million barrels of oil.
WTI Crude was up 0.8 per cent at $69.54, while Brent Crude was trading up 0.79 per cent at $78.71.
Iran is the third-largest producer among the members of the Organization of the Petroleum Exporting Countries (OPEC).
The rally could stop and prices could turn lower if someone counters with concerns over future demand in the wake of the announcement of additional tariffs on China by the United States.
LONDON-Oil prices advanced on Monday on the back of a weaker dollar and continued expectations of a global supply crunch. Oil consumption is "robust", but crude use "is beginning to face some headwinds", he said Sunday in an interview in Dubai, without elaborating.
" Oil prices have gone up after Saudi Arabia said it was comfortable with Brent oil above $80 a barrel", Olivier Jakob of Petromatrix consultancy said.
Meanwhile, oil output from seven major USA shale formations is expected to rise by 79,000 barrels per day to 7.6 million bpd in October, the U.S. Energy Information Administration said Monday. Riyadh boosted production significantly in June, pumping 10.42 million barrels a day, up from 9.9 million barrels a day in April.
As if to support Barkindo's plea, if only obliquely, Alexander Novak, energy minister for Russian Federation, stated on Monday that "I think we have the possibility to discuss any possible scenarios"- referring to the prospect of a deal between OPEC and other producers (a group known as OPEC+) being formalized and increasing output from levels agreed in June in order to ward off undue market tightening.