* Weak dollar, unrest support oil
* EU inflation data signals more tightening
* Libya civil war spills over the border into Tunisia
By Manash Goswami and Dmitry Zhdannikov
LONDON, April 29 (Reuters) - Oil prices hovered near
31-month highs as a weak dollar and violence in North Africa
outweighed concerns about slowing growth in top consumer the
United States.
In its last trading day of April, U.S. crude was heading for
its eighth consecutive month of gains, the longest run of
monthly increases since 1983, Reuters data showed.
U.S. crude <CLc1> was down 18 cents at 1027 GMT at $112.68
after settling at $112.86 a barrel on Thursday, the highest
since the close on Sept. 22, 2008.
Brent futures were down 2 cents to $125 a barrel on Friday,
$2 short of its 2011 high of $127.02, reached on April 11.
Both U.S and Brent crude regained some ground lost earlier
on Friday after euro zone data showed the inflation rate rose
further above the European Central Bank's target in April.
The data increased the chances of another interest rate rise
in June, despite weakening economic sentiment. []
The news helped push the dollar index down against a basket of
major currencies <.DXY>, with the greenback languishing near
three-year lows.
"European markets are becalmed by three consecutive short
trading weeks, and market activity has been fairly limited
during this time. Geopolitical concerns in North Africa and the
Middle East remain, with the conflict in Libya at an impasse and
Syrian unrest increasing," said Lawrence Eagles from JP Morgan.
Forces loyal to Libyan leader Muammar Gaddafi on Friday
attacked the Tunisian town of Dehiba, near the Libyan border,
[].
Morocco, which borders major oil and gas producer Algeria,
said a bomb that killed at least 14 people on Thursday in its
busiest tourist destination was a terrorist act. []
SEEN SIDEWAYS
The weak dollar also helped push silver and gold within
sight of historic highs as investors sought alternative assets.
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For a 24-hour technical outlook on Brent:
http://graphics.thomsonreuters.com/WT1/20112904083345.jpg
For a wrap on U.S. growth, inflation: []
For stories on Libya & Middle East crisis: []
For a TAKE-A-LOOK on Middle East, N Africa:[]
For top stories on the global economy: []
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Oil hovered near multi-month peaks despite weak U.S. data,
which showed on Thursday that economic growth had braked sharply
in the first quarter as higher food and gasoline prices dampened
consumer spending and sent inflation rising at its fastest pace
in 2-1/2 years.
"At current price levels the main downside risk comes from
demand destruction," said Olivier Jakob from Petromatrix
consultancy.
Growth in the U.S. gross domestic product slowed to an
annual rate of 1.8 percent from a fourth-quarter pace of 3.1
percent, the Commerce Department said. Economists had expected a
2 percent pace. []
Victor Shum, an analyst at Purvin & Gertz, said oil prices
would continue to trade sideways in the next few days.
"Any aggressive exit by is unlikely, because what are the
alternatives for investors?" Shum said. "If the global economy
tanks, stocks will go down. Oil will stay supported because of
geopolitical risks."
"With renewed buying being seen from Asian customers, we
continue to see upside price risks in the environment, unless
more concrete action from OPEC members is forthcoming," said JP
Morgan's Eagles.
(Writing by Dmitry Zhdannikov, editing by Jane Baird)
