The price of Brent crude oil traded below $97 per barrel on Monday amid weak Chinese economic data.
Reuters reported that October Brent declined to as low as $96.21 a barrel while US crude was down $1.00 at $91.27.
The news agency said the factory output growth in China fell to a near six-year low in August, indicating that the country could be at risk of a sharp slowdown.
Meanwhile, oil production in Libya is estimated to increase to one million barrels per day in October.
Oil ministers from the Middle East Gulf said last week that the oil price drop was unlikely to be affected by the Organization of the Petroleum Exporting Countries’ (OPEC) moves unless crude fell below $85 a barrel.
Oil prices have also been weakened by a strong US dollar and investors are waiting for the results of the Federal Open Market Committee meeting, which is due later this week, to know if the US will increase interest rates.
Oil prices have recently been hit by ample supplies and weak demand, but investors are keenly looking at the geopolitical tensions to ascertain if there will be any potential threat to supply.
Oil firms like Rosneft, Surgutneftegas, Lukoil and Gazprom Neft have been hit by new sanctions imposed by the US and European Union against Russia due to the ongoing Ukraine crisis, which is likely to impact future oil demand.