The price of Brent crude oil stood above $98 a barrel, indicating that the market has rebounded following a two-year low.

However, there are still concerns that the price will be affected by weak demand, excess supplies, and a strong dollar, reports Reuters.

The price of US crude was 43 cents higher, at $98.36.

"Brent futures had seen a two-year low, touching at $96.72 a barrel on Thursday, while ICE Brent futures for October grew 28 cents at $98.36 a barrel."

Brent futures had seen a two-year low, touching at $96.72 a barrel on Thursday, while ICE Brent futures for October grew 28 cents at $98.36 a barrel.

Reuters quoted Saxo Bank senior commodity strategist Ole Hansen as saying: "There was a big bounce in WTI (US) crude yesterday, which is a reflection of the fact that we’ve seen such a big selloff recently that the market was getting a bit over-extended.

"Have we seen the lows for now? It’s too early to say. The shorts are now being covered but any uptick in the market will probably be met with renewed weakness unless the geopolitical issues flare up."

Weak demand from European and Asian refiners has put pressure on prices and created an excess in the Atlantic Basin.

The International Energy Agency (IEA) has cut its demand growth estimations by 150,000 barrels per day (bpd) to 900,000 bpd for this year and by 100,000 bpd to 1.2 million bpd for 2015.

Besides an increase in shale oil production from the US, Libyan production also grew to more than 800,000 bpd and is likely to touch one million bpd in October.

SEB Commodity Research chief commodity analyst Bjarne Schieldrop was quoted by the news agency as saying: "It’s very unstable, you never know how long it will last, but it is there, and we have refineries going into turnaround at the same time."

The Kingdom of Saudi Arabia, which has the largest spare output capacity in the world, reduced its oil production by 400,000 bpd in August.

Meanwhile, the dip in oil price has been halted due to increasing tensions between Russia and the West.

The EU implemented tougher sanctions against Russia due to the ongoing Ukraine crisis, while the US is expected to impose further sanctions against Russia, which is likely to impact future oil demand, according to analysts.

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