Oil prices jumped on Monday in immediate reaction to a crucial decision by Opec and allies not to boost output urgently, rebuffing US President Donald Trump's call to increase production amid restricted Iranian crude exports and tightening global supply.
Earlier today, Brent crude hit its highest since May at $80.62 per barrel, up $1.82 or 2.3 percent, by 0830 GMT.
"We will consider waivers where appropriate but it is our expectation that the purchases of Iranian crude oil will go to zero from every country or sanctions will be imposed", Pompeo said earlier this month.
OPEC, along with a group of Russia-led producers, put a cap on output in January 2017 in response to a supply glut and a sustained rout in oil prices that bankrupted U.S. energy firms and escalated unrest in exporting countries.
Saudi energy minister Khalid al-Falih said the oil market is balanced and that its partners have increased production in response to rising prices.
The US President said in a tweet last week that Opec "must get prices down now!" by raising global output.
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Nearly 2 million barrels per day (bpd) of crude could be taken out of the market as a result of the United States sanctions against Iran by the end of the fourth quarter this year, said Daniel Jaeggi, president of commodity merchant Mercuria Energy Trading, making a crude price spike to US$100 a barrel possible.
Brent crude climbed above US$80 a barrel after OPEC and its allies signaled less urgency to boost output, despite USA pressure to temper prices.
"Thus the window period for oil prices to potentially extend gains is quite wide as Iran loses exports and OPEC+ remains on standby", Tchilinguirian said.
The move follows a report that OPEC producers are in no rush to boost production levels further.
At the end of the day Riyadh might have to choose between its decades' long alliance with the US, still a top procurer of its crude oil and its major military arms supplier and defender - and between Russian Federation, its fledgling but increasingly important energy ally, even if it's an allegiance based on economic convenience and not mutually shared geopolitical philosophies and ambitions.
Iran told OPEC its production had been steady in August at 3.8 million barrels per day.
"It is critical that we continue to foresee and anticipate changing market supply and demand balances and take proactive actions to avoid conditions that could make [oil] consumers uneasy and anxious".