Economic Factors Keep Brent Below $98

Brent crude oil slid back below $98 to start the week as investors shrugged off the possibility of OPEC cutting supplies and instead focused on the deteriorating global economy.

The commodity traded at $97.86 at 4:30 GMT despite growing tension in Eastern Europe and the Middle East.

Economic factors have been driving crude prices recently, as a slowdown in demand has created a supply glut at a time when crude production is on the rise.

At the G20 summit over the weekend, global leaders were optimistic about the direction of the world’s economic growth, saying they saw growth reaching 1.8 percent by 2018. However, the concerns about progress in Europe remained a major focus.

Some of the world’s leaders believe that the European Central Bank needs to step in with an outright stimulus program in the near term, while others say the region needs to focus on structural reforms within individual member states in order to prevent another financial crisis.

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Meanwhile, geopolitical tension in Eastern Europe has the potential to cause a supply interruption, but has been largely overlooked in light of the state of the global economy. CNBC reported that Exxon Mobil XOM has said it is planning to reduce its drilling in Russia in order to comply with U.S. sanctions aimed at the nation’s oil sector.

The conflict in the Middle East is also on the radar after the U.S. push against ISIS widened on Friday when the French military joined U.S. efforts with an airstrike in Iraq aimed at stopping the Islamic Militants from gaining any more ground.

The radical group has taken control of much of Iraq and some parts of Syria despite an ongoing effort to help stem its movement.