Oil pumps are seen at sunset outside Vaudoy-en-Brie, near Paris, France April 23, 2018.
"The U.S. sanctions against Iran apply to the purchase of U.S. dollars and might therefore already impact Iranian oil exports", added Giovanni Staunovo, a commodity analyst for UBS.
"The US seems hell-bent on regime change in Iran", said Greg McKenna, chief market strategist at futures brokerage AxiTrader.
The sanctions target Iran's us dollar purchases, metals trading, coal, industrial software and its auto sector.
French bank Societe Generale said there was now a "comfortable supply" in physical crude markets, but noted "Iran sanctions will take another 1 million bpd off the markets".More news: Severe thunderstorm watch in effect for Guelph and area
U.S. West Texas Intermediate and international-benchmark Brent crude oil futures are trading higher early Monday amid reports of a drop in Saudi crude production in July and speculation that American shale drilling may be plateauing.
Analysts have predicted the sanctions could put more than two million barrels per day at risk.
WTI had pierced 69 the figure again with a high so far of $69.15bbls.
President Donald Trump installed the first wave of sanctions Monday, targeting Iran's financial, automotive, aviation and metals sectors and threatening that the second wave will "ratchet up to yet another level" in November.More news: Dota 2 veterans defeated by OpenAI bots
It also is not clear if the State Department could allow sanction waivers, which were used in the Obama era to wean the world off of Iranian oil and avoid supply shocks.
Iraqi Prime Minister Haider al-Abadi said his country opposes sanctions on Iran, but will abide by them to protect its own interests. The Saudi production data came as surprise to traders at the start of this week, presuming that Saudi production would have risen in July given the pledges from Russian Federation and the Organization of the Petroleum Exporting Countries where they had supposedly agreed in late June to begin ramping up crude output after more than twelve months of curbing output. "There is no wish from Saudi Arabia to push prices down to $50".
Additionally, there are also reports that many US shale oil drillers posted disappointing quarterly results in recent weeks, hit by rising operating costs, hedging losses and a drop in crude prices away from 2018 highs reached between May and July.
"Without the extra Saudi oil we had in June, it's hard to crunch the numbers and get a lower price going into the end of the year", said John Kilduff of Again Capital.More news: Lucas Perez: West Ham close to signing of Arsenal's Spanish forward