"Iran jitters helped push oil prices higher but a broader stabilization of crude futures near 3½-year highs can be tied to several big, prevailing trends", according to CNBC.
USA light crude was 5 cents higher at $71.01 a barrel, also not far off its highest since November 2014.
Oil price is now trending towards $80 per barrel following bullish trading that heightened yesterday in the worldwide market which saw the price leap to $78 yesterday, up from $67 April average.
President Trump's decision to pull the US out of the Iran nuclear deal "constitutes a major geopolitical shift" which could trigger a move in the direction of "stagflation", a global strategy team at Citi, led by Mark Schofield, said in a research note, CNBC reported.
The surge in oil prices comes at a time of tight supply amid record Asian demand and voluntary output restraint by the Organisation of the Petroleum Exporting Countries and non-OPEC producers, including Russian Federation.
OPEC raised its forecast for global oil demand in 2018 in its monthly oil market report, indicating strong growth in developed and emerging economies.
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The tightening market has all but eliminated a global supply overhang that depressed crude prices between late 2014 and early 2017.
OPEC data presented on Monday showed that crude stockpiles from members of the Organization for Economic Co-operation and Development (OECD) was down to 9 million barrels above the 5-year average and lower than the 340 million barrels above the average in January 2017.
Once the sanctions are reinstated later this year, traders expect a massive decline from 200,000 to about 1 million barrels per day (bpd) in Iran's oil exports, which may put the already squeezed crude markets at risk of becoming undersupply.
Oil service giant Baker Hughes reported on Friday the number of rigs operating in American oil fields rose by 10 to a total of 844.
USA crude is trading at a hefty discount to Brent, the worldwide marker, thanks to sharp rises in United States production to 10.7-million bpd, which has left the American domestic oil market well supplied.
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