US President Donald Trump on Monday said he would impose 10 percent US. tariffs on about $200 billion worth of Chinese imports.
The change in Saudi Arabia's view on prices coincides with some intense oil diplomacy.
Oil markets slipped on Tuesday as the latest escalation in the Sino-US trade war clouded the outlook for crude demand from the two countries, the world's top crude consumers.
Brent futures LCOc1 also rose but the gains were more muted, as the global benchmark ended 37 cents, or 0.5 percent, higher at $79.40 a barrel.
"As oil sanctions against Iran take effect, perhaps in combination with production problems elsewhere, maintaining global supply might be very challenging and would come at the expense of maintaining an adequate spare capacity cushion", IEA said in its monthly Oil Market Report.
Oil eased on Wednesday, but held near its highest level this year, as concerns that producers may fail to cover a supply shortfall once USA sanctions on Iran come into force outweighed an increase in U.S. inventories.
US West Texas Intermediate (WTI) crude was down 28c, or 0.4%, to $68.62 a barrel.
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OPEC and non-OPEC compliance with the Vienna Agreement production ceiling slipped to 97 percent in July as large producers relaxed output constraints amid falling production in crisis-hit Venezuela and expectations that Iran may be prevented from exporting oil to large parts of the globe.
The rally could stop and prices could turn lower if someone counters with concerns over future demand in the wake of the announcement of additional tariffs on China by the United States.
OPEC and non-OPEC producers Russian Federation started withholding oil supplies in 2017 to end a global glut and prop up prices.
November WTI and December Brent Crude Oil should continue to push higher throughout the session as long as a possible supply shortage remains the theme.
Barkindo, 59, also said the pact made between the OPEC members and non-members that saw a slash in production and brought the prices back from lows of $30 per barrel in January 2016 was now "a permanent feature".
U.S. crude futures CLc1 were up $1.08 at $70.93 a barrel by 11:15 a.m. [1515 GMT], after the U.S. Energy Information Administration said crude and gasoline stockpiles fell last week.
Saudi Arabia is now comfortable with Brent oil prices rising above $80 a barrel, at least in the short term, as the global market adjusts to the loss of Iranian supply from US sanctions, according to people familiar with the kingdom's view.