* UN inspectors declare Iran mission a failure
* India seeks 100,000 bpd more from Saudi for 2012-13
* Japan may cut Iranian imports 20 pct or more -paper
* COMING UP: EIA inventory data at 1600 GMT (Adds euro record, comment on para 6, updates prices)
By Zaida Espana and Simon Falush
LONDON, Feb 23 (Reuters) - Brent crude oil powered to a nine-month high above $124 per barrel on Thursday and reached its highest ever price in euro terms, lifted by heightened tension between Iran and the West.
The U.N. nuclear watchdog's latest mission to Iran failed to budge a defiant Tehran over its disputed nuclear programme, heightening fears that possible military confrontation could lead to supply disruption.
Brent crude for April delivery was up $1.28 at $124.19 by 1138 GMT, having touched an intraday peak of $124.48 per barrel, the highest since early in May 2011.
It was up 11.8 percent in February, on track for its biggest monthly gain since May 2009.
Brent reached 93.64 euros, its highest level since the single currency was established in 1999, prompting mounting concern that high prices will take their toll on a fragile economic recovery.
"It will damage corporate margins, and the consumer is not in a strong position, so companies will not be able to push prices through," said David Morrison, market strategist at GFT Markets.
U.S. crude futures for April were 13 cents firmer at $106.41 after settling at a nine-month high of $106.28 a barrel the previous day.
As well as fears about conflict between Iran and the West, thinning supply in the North Sea, South Sudan, Syria and Yemen lifted front-month Brent futures by more than 10 percent.
India has sought an additional 100,000 barrels per day (bpd) from top global oil exporter Saudi Arabia for 2012/13, India's junior oil minister said on Thursday, which is seen as a move to replace Iranian supplies.
Japan could cut Iranian imports by 20 percent or more this year, a Japanese newspaper reported, following reductions planned by other buyers in Asia and Europe as Western sanctions made trade difficult.
"With extremely limited buffers to absorb any one of the series of potential geopolitical mishaps, the backdrop of the oil market is getting uneasy, and maintaining a deep short position would not be wise," Barclays analysts warned.
Tension elsewhere in the Middle East added to investor anxiety about supply.
Iraq lived through one of its bloodiest days since U.S. troops pulled out in mid-December when a string of early morning attacks on most Shi'ite targets across the country killed at least 60 and wounded dozens, raising the spectre of widespread sectarian violence.
Amid worries about crude availability and high oil prices, all eyes are on the inventory report to be released by the U.S. Energy Information Administration at 1600 GMT.
Data from the American Petroleum Institute on Wednesday showed crude stockpiles rose by 3.6 million barrels in the week to Feb. 17, well in excess of analysts' expectations for a 500,000 barrel build.
GASOLINE PRICE WORRY
Skyrocketing U.S. gasoline prices have become an issue for the 2012 presidential election season. Three Democratic lawmakers on Wednesday urged the White House to signal it is ready to tap the nation's oil stockpiles.
Goldman Sachs expects the spread between September U.S. crude and Brent futures to narrow to $5 a barrel in six months following the scheduled June reversal of the Seaway pipeline to carry crude oil from Cushing, Oklahoma to the U.S. Gulf Coast.
The bank predicted further upside in Brent crude this year but said that with prices currently above its three-month target of $120 per barrel, the U.S. benchmark offers better trading opportunities from June onwards.
The front-month Brent crude premium against U.S. crude narrowed to around $17.70 by 1123 GMT from close to $21 on Feb. 7 as inventories rose at Cushing, the delivery point for West Texas Intermediate crude. (Reporting by Zaida Espana in London and Florence Tan in Singapore; editing by Jane Baird)
There are no comments yet