The starting point is this: the pressure at level X must be the same on both sides of the U-tube. If that were not so, the water in the bottom of the U would be accelerating - and it isn't.
On the left side, the pressure at X is the atmospheric pressure P0 plus the pressure due to a column of oil Hoil = 35 cm high. This last pressure is oilgHoil.
On the right, the pressure at X is again the atmospheric pressure P0 plus WgHW, where the subscripts W stand for water. So,
P0 + oil * g * Hoil = P0 + W * g * HW
or
oil * Hoil = W * HW
and
HW = (oil/W) * Hoil = (0.8*103/1*103) * 0.35 = 0.28 m = 28 cm.