* Price consolidates as technical chart show momentum fading
* U.S. dollar index <.DXY> falls as euro strengthens <EUR=>
* China's crude imports surge in March
(Updates throughout, prices)
By Christopher Johnson
LONDON, April 12 (Reuters) - Oil prices slipped below $85 a
barrel on Monday, consolidating despite a drop in the dollar and
bullish data showing a big jump in Chinese crude imports.
Technical chart analysts said the oil market was running out
of upward momentum after a sharp rise in prices at the end of
March and in early April. The pull-back came despite factors
that analysts said were supportive for oil prices.
Euro zone finance ministers approved a giant 30 billion euro
($40 billion) emergency aid mechanism for debt-stricken Greece
on Sunday but stressed Athens had not requested the plan be
activated yet. []
The news drove the euro to its highest levels in nearly a
month in Asian trade, while the dollar index fell 0.6 percent
against a basket of currencies on Monday.
A weak dollar often supports oil prices, making commodities
denominated in dollars cheaper for other currency holders.
U.S. crude for May delivery <CLc1> was down 47 cents to
$84.45 a barrel by 1200 GMT, wiping out an earlier 79 cent gain.
"The weaker dollar and strongly bullish Chinese data should
be very positive for oil," said Daniel Briesemann, commodities
analyst at Commerzbank. "Of course fundamentally, these high oil
prices cannot be justified, but based on sentiment, the market
still has room to go up, we think."
London Brent crude <LCOc1> fell 19 cents to $84.64, moving
to a premium above U.S. crude, also known as WTI, for the first
time in months with traders saying the North Sea grade was
benefiting more than its U.S. counterpart from the Chinese data.
TARGET $90?
"International demand ... is having a more positive impact
on Brent than WTI," said Christopher Bellew, broker at Bache
Commodities in London. "U.S. crude oil stocks are high and WTI
has its limitations as an (international) marker price because
it is based on a landlocked crude, well away from the coast."
The North Sea crude oil market is also tightening ahead of
routine maintenance work. The last time Brent futures traded
consistently above U.S. crude was in December.
China's strong demand for oil and copper showed no let-up in
March, with imports rising rapidly despite higher prices as
factories returned to work in earnest after the long Lunar New
Year holidays. [] []
Crude imports by China jumped 13.8 percent from the previous
month and reached 4.95 million barrels a day, preliminary data
released by the General Administration of Customs showed.
Barclays Capital analysts said oil prices had convincingly
broken out of the $70-$80 a barrel range and could rise towards
$90 as the global economy regained strength.
"The follow-through in the recovery in coming months may
well be one element behind the creation of a base for a further
shift up in prices," Barclays analysts said in a report.
"The very limited recent increases in prices seem justified;
indeed, they are perhaps remarkably modest given the pace of
global recovery over the past two quarters in particular."
In a sign of upbeat sentiment over oil prices, open interest
positions were heavier at the NYMEX May $90 call option and the
$80 and $75 put options, according to Reuters data on Friday.
[]
Separately, money managers extended net crude oil long
positions on the New York Mercantile Exchange to a record
186,732 in the week to April 6, up from 169,478 in the previous
week, the Commodity Futures Trading Commission said on Friday.
[]
(Additional reporting by Fayen Wong in Perth; editing by James
Jukwey)
