By Simon Falush
LONDON, May 7 (Reuters) - Brent crude oil reached its highest in nearly a month on Tuesday, heading towards $106 a barrel, supported by strong German data, central bank policy and tension in the Middle East.
The benchmark also gained on Monday, on fears of supply disruption after the Israeli air strikes on Syria close to Damascus, though the effect of this has subsided somewhat, analysts said.
Brent crude rose 12 cents to $105.58 a barrel by 1422 GMT, having earlier reached $105.88, the highest since April 11.
Brent has rebounded nearly $7 a barrel since falling below $99 last Wednesday. U.S. oil fell 49 cents to $95.67 after ending 55 cents higher on Monday.
Oil and other risk-sensitive assets, such as equities, were boosted by renewed optimism about the global economy, thanks in part to supportive measures from central banks.
The Reserve Bank of Australia cut its cash rate by 25 basis points on Tuesday to a record low of 2.75 percent.
On Monday European Central Bank (ECB) president Mario Draghi said that the ECB would cut rates again if needed.
'There's a glow of comfort for investors, with central banks in Europe and the United States more supportive across the board,' said Bjarne Schieldrop, chief commodities analyst at SEB in Oslo.
Positive data also helped to lift prices, with German industrial orders rising again in March, confounding expectations for a drop and helping to brighten a rather gloomy demand outlook.
Attention focused again on China, the world's second-largest economy, ahead of preliminary April trade data due on Wednesday.
China's crude oil imports last month were expected to have held near March levels, which were 2.1 percent lower than a year earlier.
Chinese inflation data on Thursday and money supply and loan growth figures expected from Friday will also be watched.
Expectations of a further build in U.S. commercial crude oil
stocks, after hitting a record high, dragged on prices.
A preliminary Reuters poll, taken ahead of weekly inventory reports from the American Petroleum Institute (API) and the U.S. Energy Department's Energy Information Administration (EIA), forecast on average that crude stocks increased by 1.8 million barrels in the week ended May 3.
Prices may rise in the second half of 2013, Morgan Stanley said in a research note. The bank said that the global oil balance looked much tighter this summer, with Brent likely to trade up to $110 to $115 in the second half.
In the week to April 30, hedge funds and other large speculators increased bets on higher Brent prices, upping net long positions by 9,614 contracts to 108,741, data from the IntercontinentalExchange (ICE) show.
(Editing by Sophie Walker) Keywords: MARKETS OIL/
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