Oil prices have risen as worries over supplies weighed on assurances that the top crude producers; Saudi Arabia, Russia and the US, have increased output.
Brent crude oil futures jumped 25 cents to reach $78.34 a barrel, while US West Texas Intermediate (WTI) futures went up 28 cents to stand at $69.27, Reuters reported.
The US Government has assured the industry that the top crude producers can step up output to counter declining supplies from Iran and elsewhere.
In an interview given to the news agency, US Energy Secretary Rick Perry said that oil prices are not expected to rise further and that the three countries can raise global output in the next 18 months.
In the wake of increasing pressure from Washington, buyers are reducing crude purchases from Iran ahead of the looming sanctions that will be re-imposed in November this year.
Meanwhile, Iran’s Organization of the Petroleum Exporting Countries (OPEC) governor has condemned the growing influence of Saudi Arabia and Russia on the oil market and accused other producers of turning the body into a US tool.
Prices are also impacted by the ongoing trade war between the US and other major trading nations.
US President Donald Trump is expected to up the ante on the trade dispute by announcing new duties on around $200bn of Chinese imports as early as 17 September, according to Reuters, which citied a senior administration official.
The intensifying trade war could result in slower growth in oil consumption.
Guotai Junan Futures crude research head Wang Xiao said: “The market’s expectation of shortages has cooled after data from last week showed increases in supplies, while investors have lowered the outlook for oil demand.”