Benchmark Brent crude was up 1.33 percent at $79.20 a barrel. Finally, the maiden speech of the Fed's new chairman, Jay Powell, served to weaken the dollar and send oil prices upwards once again. Crude is up 9% since mid-August as WTI flirts with $70 per barrel. China also made similar comments and was said to have rejected an American request to cut imports.
The Iranian rial hit a record low against the USA dollar on the unofficial market Monday amid a deterioration in the economic situation and the reimposition of sanctions by the United States.
Prices could rise due to Iranian supply being curbed due to US sanctions.
As well, Showa Shell Sekiyu plans to "observe a government decision" on Iranian oil imports, said a spokesman for the crude wholesaler, but no specifics have been provided.
The moves by the two top buyers of Iranian crude indicate that the Islamic Republic may not be fully cut off from global oil markets from November, when United States sanctions against Tehran's petroleum sector are due to start, it said.
U.S. West Texas Intermediate (WTI) crude CLc1 futures fell $1.15 to settle at $68.72 a barrel, a 1.65 percent loss.
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As Iranian oil is cheaper than that from other countries, the suspension will increase the distributors' costs and could lead to higher gasoline prices in Japan.
"US producers are resisting temptation and exercising capital discipline, Opec and Russian Federation have convinced market participants they are managing the supply of over half of global production, the USA is using sanctions more actively, and several key Opec producers are at risk of being failed states", Barclays said. Russian production has now surpassed the Soviet era peak above 11 million barrels per day.
But Trump's attack on cheap Chinese imports, and his decision to impose trade tariffs on a wide range of Chinese goods entering the US, could damage China's economic growth and in turn lower its demand for oil.
While investors are now enjoying the bullish wave in oil markets, it is important to keep an eye on the bearish flashpoints hanging over markets this September.
Production by the Organization of the Petroleum Exporting Countries rose 220,000 barrels per day (bpd) in August to a 2018 high of 32.79 million bpd, a Reuters survey showed. "If there is a serious trade disagreement between the USA and China, the Chinese consumption of energy will be impacted negatively, from our point of view and the ability to produce and export will be impacted", he said at the World Heavy Oil Congress.