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Oil prices rise in Asia after attacks on Libyan oil terminals

Oil prices rise in Asia after attacks on Libyan oil terminals

SINGAPORE: Militants attack on Libya’s main oil terminals caused hike in oil prices in Asia. As dealers reacted to a surprise attack that left 22 soldiers dead, while year-end short-covering also provided support.

US benchmark West Texas Intermediate for February delivery rose 10 cents to $55.94 in afternoon trade, while Brent for February gained nine cents to $60.33.

Trading volumes in Asia were thinner than usual with major regional financial markets including Hong Kong and Australia closed on Friday. US and European stock markets will also be shut for the Boxing Day holiday.

Analysts said some bearish dealers were taking profits on short positions, pushing prices up.

The attack in Libya’s oil-rich region on Thursday, saw militiamen belonging to the Fajr Libya, or Libya Dawn, target Al-Sidra port by firing rockets from speedboats, setting an oil tank on fire, security forces official told Customs Today.

Production in Libya, a member of the OPEC oil-producing cartel, has only just started to rise following a prolonged disruption due to civil unrest.

Analysts also said short-covering was propping up prices, with dealers largely ignoring a surprisingly bearish US stockpiles report released on Wednesday.

“Prices seem adamant on staying above support levels, and it seems they will hold for this festive season,” said Daniel Ang, investment analyst at Phillip Futures in Singapore.

“We continue to attribute this to the short-covering at the end of the year as oil bears close out positions to celebrate the New Year,” he said.