* Premiums for gold bars in Tokyo jump $1/oz
* Violence continues to simmer in Libya, Bahrain
* European leaders agree to strengthen bailout fund
(Updates prices, adds detail, comment)
By Jan Harvey
LONDON, March 14 (Reuters) - Gold prices rose in Europe on
Monday, recovering some of last week's one percent losses, as
the impact of an earthquake in Japan added to upward pressure on
the metal, driving it back towards recent record highs.
Gold <XAU=> was at $1,422.65 an ounce at 1504 GMT versus
$1,417.70 late on Friday, within sight of the record $1,444.40
it hit last week. It fixed at $1,422.25 at 1500 GMT. U.S. gold
futures for April delivery <GCJ1> rose $1.30 to $1,423.10.
Thousands in Japan have been killed or displaced by Friday's
earthquake and subsequent tsunami.
"Safe-haven buying clearly seems to pushing bullion higher,
and (that) may be the case until Japan and the world quantify
the financial losses due to this disaster," said Pradeep Unni,
an analyst at Richcomm Global Services.
"Investment demand may see a surge in the coming sessions
which could take gold to fresh record highs," he added. "The
only doubt cast to this view is that Japanese retailers may sell
gold to raise immediate cash."
Rescue workers combed the region north of Tokyo for
survivors and struggled to care for millions of people without
power and water in what Prime Minister Naoto Kan has dubbed his
country's worst crisis since World War Two. []
Roads and rail, power and ports have been crippled across
much of Japan's northeast and estimates of the cost of the
multiple disasters have leapt to as much as $170 billion.
Premiums for gold bars in Tokyo jumped to their highest
since February at $1 an ounce versus spot London prices, from
zero last week, dealers said. []
Oil prices fell, stock markets slipped and the yen retreated
from record highs against the dollar after the Bank of Japan
announced a series of policy easing measures to shore up the
economy in the wake of the disaster. [] [] []
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Reuters graphics on Japan: http://r.reuters.com/fyh58r
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MIDEAST SIMMERS
Unrest in the Middle East and North Africa continued to
spread, with Saudi Arabia sending troops into Bahrain on Monday
to help put down weeks of protests by the Shi'ite Muslim
majority. []
As Libyan leader Muammar Gaddafi's troops battled rebel
fighters for control of the strategic oil town of Brega, France
stepped up efforts to persuade world powers to impose a no-fly
zone over the country. []
Violence which has spread from Egypt and Tunisia across the
Middle East this year was a major factor driving gold to record
highs, and precipitated a spike in oil prices.
"Japan is another risk element in a plethora of events which
have been important in the minds of investors in the past
quarter," said Deutsche Bank analyst Daniel Brebner.
"You have the Middle East/North Africa situation, the
peripheral euro zone debt issues which seem to be re-emerging,
there are questions with respect to China raising interest rates
near term, and there are municipal issues in the United States,
particularly on debt."
"This is all creating an environment where there appears to
be support for precious metals, and gold in particular."
In Europe, analysts said they saw little reaction in the
gold price from this weekend's agreement among European leaders
to strengthen the euro zone bailout fund, a move designed to
address the bloc's year-long debt crisis. []
"From gold's perspective, Saturday's agreement represents a
positive surprise that should help the euro but may in initial
assessment present less immediate need for additional gold long
exposure," said UBS in a note.
Among other precious metals, silver <XAG=> was bid at $35.82
an ounce versus $35.83, platinum <XPT=> at $1,752 an ounce
against $1,778.50 and palladium <XPD=> at $746.47 against $757.
(Editing by Anthony Barker)
