Heat olive oil and butter in a medium saucepan over medium heat. Add the onions and sugar and cook until the onions are golden brown and caramelized. Add the garlic and cook for 2 minutes.
While the onions are cooking, place the potatoes in a medium saucepan filled with cold salted water. Bring to a boil and cook until the potatoes are just cooked through. Drain the potatoes and set aside.
Add the clam broth to the onions and bring to a simmer; then add the heavy cream. Add the potatoes and simmer just until heated through. Whisk in the creme fraiche and season with salt and pepper, to taste. Add the oysters and the tarragon and cook just until oysters are cooked through, about 2 to 3 minutes. Serve, garnished with extra tarragon.
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