Short-covering and oil tank attacks are two factors boosting oil prices soaring

US NYMEX WTI crude oil March futures closed up 1.
18 US dollars on Thursday (January 21), or 4.
16%, to 29.
53 US dollars / barrel
.
After the Asian market opened to most of the European market, oil prices fluctuated between US$27.
87/barrel to US$28.
75/barrel
.
Before the release of the US EIA inventory data, oil prices were affected by short covering and rose by about US$0.
6 in the short term
.
Afterwards, the US EIA inventory data showed that crude oil inventories increased significantly compared with the previous value, and oil prices fell by about US$0.
3.
However, due to the news that the Libyan crude oil terminal was attacked, the oversold rebounded in coordination, and the oil price quickly rose by more than US$0.
8 to the highest point of 30.
25 in the day.
USD/barrel
.
It fell slightly before the close
.
At the same time, ICE Brent March crude oil futures prices closed up 1.
37 US dollars on Thursday, or 4.
91%, to 29.
25 US dollars / barrel
.
As oil prices have been technically "oversold" before, there are reports that Libya's crude oil terminal has been attacked, triggering market concerns that there will be problems with crude oil supply in the Middle East.
Crude oil futures prices rose sharply by more than 4 on Thursday.
%
.
On Wednesday, WTI oil prices and Brent oil prices in the United States set their lowest levels since 2003
.
Phil Flynn, senior market analyst at Price Futures Group, said that two factors stimulated the rise in oil prices on Thursday
.
On the one hand, the increase in U.
S.
EIA crude oil inventories announced on Thursday was not as large as the increase in U.
S.
API crude oil inventories announced on Wednesday; on the other hand, there were reports of a fire in Libya’s crude oil storage tanks
.
According to Agence France-Presse, in order to control the export of crude oil, the "Islamic State" attacked crude oil terminal facilities located in the northern oil port of Libya
.
Flynn said the news dispelled people's worries that Libya will soon export more crude oil
.
However, Tim Evans, chief market analyst at Long Leaf Trading Group, believes that the attack on the Libyan oil port is not the main reason for the sharp rise in crude oil prices.

.
Because relative to the global supply, Libya's supply is relatively limited
.
Evans believes that the risk aversion in various markets has faded.
Therefore, the direction of changes in crude oil prices should be consistent with the directions of changes in other market prices
.
Both European and American stock markets moved higher on Thursday
.
Nevertheless, the attack in Libya is still considered by the market as a major factor in offsetting the negative US crude oil inventory data
.
The report shows that as of the week of January 15, US EIA crude oil inventories increased by 3.
979 million barrels, not as much as the increase in API crude oil inventories announced earlier.
API crude oil inventories recorded an increase of 4.
61 million barrels
.
Tyler Richey, editor of the 7-point report that wrote the daily market commentary, said that another factor supporting oil prices is that the crude oil production of the 48 states in the United States has declined slightly for the first time in the past 7 weeks
.
At least, this information makes the extreme oversupply situation in the global crude oil market seem not so pessimistic, and the market also has good reasons to lock in the profits from short selling after the sharp drop in oil prices
.
Overall, John Macaluso, an analyst at Bridge Capital Consulting, said that although oil prices have rebounded sharply after the release of inventory data, the overall atmosphere is still biased towards bearishness
.
Today's rebound is only because of short covering after the technical oversold to lock in profits
.
Until the fundamentals really change, you still need to be cautious about buying bottoms
.