* China inflation mitigates tightening worries
* Iran, North Korean issues remain in focus
* Coming Up: API weekly crude stocks; 2030 GMT
By Ramya Venugopal
CHENNAI, India, April 9 (Reuters) - Brent crude futures rose above $105 per barrel on Tuesday after data showed China’s inflation in March was slower than expected, giving its central bank room to keep monetary policy easy and support oil demand in the world’s second-biggest consumer.
Oil prices were also supported by worries over increasing tension in North Korea and a stalemate in talks between Iran and Western nations.
“The softer-than-expected inflation is supportive to oil markets,” said Ben Le Brun, a market analyst at OptionsXpress in Sydney. “As the potential to tighten policy may now be on the back burner, this is more of a short-term relief.”
Front-month Brent futures rose 47 cents to $105.13 per barrel by 0315 GMT, after moving in a $2-range in a choppy session on Monday. U.S. crude futures rose 20 cents to $93.55 per barrel.
Brent may trade between $103 and $110 per barrel in coming weeks, LeBrun added. The contract has a good chance of breaking a resistance at $105.38, Reuters technical analyst Wang Tao said.
China’s annual consumer inflation eased to 2.1 percent in March from February’s 3.2 percent while producer price deflation deepened, data showed on Tuesday.
The data is likely to reduce the anxiety building among some investors that China’s policymakers may begin tightening monetary conditions early in the recovery cycle, especially amid concerns of a bubble in the property market.
With other data from China pointing to a moderate recovery, demand worries from the West, following weaker than expected jobs numbers from the United States and problems in Europe, may be mitigated somewhat.
Still, global oil demand is expected to pick up from the third quarter, analysts say.
“Any 2Q12 weakness will likely be short-lived. The greater demand pull and reduced spare capacity should create upside for price and structure this summer,” Morgan Stanley analysts wrote in a report.
Geopolitical tensions may also keep prices elevated.
North Korea has nearly closed its last major project with its southern neighbour, fuelling speculation it will engage in some sort of provocative action -- another nuclear weapons test or missile launch -- in a crisis that has become one of the most serious on the peninsula since the Korean War ended in 1953.
Tension has been rising since the United Nations imposed new sanctions against the North in response to its third test of a nuclear weapon in February. Pyongyang has been further angered by weeks of joint military exercises by South Korean and U.S. forces and threatened both countries with nuclear attack.
Iran’s dispute with the West over its nuclear program showed no signs of dissipating as weekend talks ended without a resolution, although Western diplomats said there were enough grounds to continue the dialogue.
“Any potential for war with North Korea, as well as the festering Iran issue, will keep a floor under the oil price,” said Le Brun.
Oil markets are also awaiting key U.S. inventory data for the week ended April 5, due on Tuesday and Wednesday. Data for the previous week had shown an inventory build-up last seen in 1990, dragging oil prices down to an eight-month low on Friday.
A Reuters survey of five analysts shows that crude stockpiles are expected to rise by 1.5 million barrels.
Data from the American Petroleum Institute is expected on Tuesday, while the Energy Information Administration will release its data on Wednesday. (Editing by Clarence Fernandez)