On Friday (February 7th) during the European trading session, the trading price of light crude oil futures rose slightly, hovering between the 50 day moving average of $71.02 and the 200 day moving average of $70.77. The market's response to these technological levels may determine the short-term direction, and traders closely monitor breakthroughs or breaks.

At present, the three-month trading range is between $64.78-79.44, and the price is testing the key retracement zone of $72.11-70.38. Continuing to rise above the 50 day moving average may strengthen bullish sentiment, but resistance remains strong at $72.11. On the contrary, falling below the 200 day moving average may trigger increased selling pressure, and breaking through the Fibonacci support level of $70.38 may accelerate the decline towards $67.09.

Concerns about tariffs have caused oil prices to fall for a week in a row

Despite a slight increase last Friday, crude oil prices will continue to decline for the third consecutive week due to global trade tensions continuing to put pressure on demand prospects. Although Brent crude oil rose on the same day, it fell 2.6% this week, while West Texas Intermediate (WTI) fell 2.1% during the same period.

The recent downward pressure comes from the new tariff threat from the United States, with President Trump imposing a 10% tariff on Chinese imports and temporarily suspending planned tariffs on Mexico and Canada. Analysts believe that although tariffs bring uncertainty, which sometimes benefits commodities, the broader concern is that long-term trade disputes will suppress global GDP growth, thereby reducing oil demand.

Sanctions against Iran provide potential support factors

The US Treasury Department has announced new sanctions on some individuals and oil tankers in the Iranian oil industry, as a further effort to curb Iran's oil revenue. Societe Generale predicts that these sanctions could reduce Iran's oil exports by half, potentially leading to global supply shortages.

However, the direct response of the market is silent. Traders are still concerned about demand risks, fearing that tariffs and retaliatory measures will suppress consumption growth. The combination of geopolitical risks and economic uncertainty is creating a volatile trading environment, and short-term price trends may be influenced by changes in macroeconomic sentiment.

The surge in inventory intensifies bearish pressure

Further suppressing crude oil prices is the unexpected surge in US crude oil inventories, which increased significantly last week. The higher than expected increase in production capacity highlights the seasonal maintenance of US refineries and weakened demand. In addition, President Trump's renewed commitment to increase US oil production has intensified bearish sentiment and heightened concerns about recent oversupply.

Market outlook: Short term bearish, with key technical observation points

Crude oil prices are still at a critical juncture, and technical proficiency plays a crucial role in short-term trends. If it continues to rise above the 50 day moving average at $71.02, it will provide upward momentum, while if it fails to hold above the 200 day moving average at $70.77, it may lead to further selling.

Fundamentally, downside risks persist due to trade-related demand concerns and rising US crude oil inventories. However, the geopolitical uncertainty surrounding Iran sanctions may provide intermittent support. Traders should pay attention to decisive breakthroughs in key support or resistance levels to determine the next major trend in crude oil prices.