* China copper demand down 12.5 percent in February * Oil rises as Western powers strike Libya * Coming up: U.S. existing home sales for Feb; 1400 GMT (Updates prices, adds comment, changes dateline from SINGAPORE) By Sue Thomas LONDON, March 21 (Reuters) - Copper rose slightly in subdued trading, caught between prospects of demand for industrial metals to rebuild Japan's infrastructure and concerns about conflict in Libya and the Middle East. Data showing China's February imports of refined copper fell to a 27-month low because of holidays in the shortest month of the year and high inventories, pinned back prices of the metal used in construction and power. Three-month copper on the London Metal Exchange was $9,572.15 a tonne by 1040 GMT from Friday's $9,510 close. The market was also closely following the situation in Libya, where Western powers launched a second wave of air strikes early on Monday, sending U.S. crude oil futures up $1.64 at $102.71 a barrel. "We've seen equities rebound in Asia overnight and opening higher in Europe this morning, and the joint effort to try and remove (Libyan leader Muammar) Gaddafi is driving risk appetite higher," Christin Tuxen, an analyst at Danske bank, said. European stocks were up 1.6 percent in early trade, and U.S. stock futures pointed to a strongly higher open on Wall Street. Aluminium rose 1.4 percent to $2,595 a tonne from $2,560 at the close on Friday. Tuxen partly attributed the rise to higher oil prices, which rose more than 1 percent on Monday. Aluminium smelting is highly energy intensive. "If oil prices go higher it will benefit aluminium because it's ahead of the cost curve," she said. "And it seems the Libyan situation is not going to go away soon, and that means energy costs will be elevated for quite a while and that is something that should support aluminium." INVENTORIES Copper stocks continued to build, rising 850 tonnes, with most of the deliveries flowing into Singapore and Gwangyang warehouses, underlining physical market weakness in the Asian region. China's apparent demand for refined copper fell 12.5 percent in February as imports slowed and stockpiles held at the Shanghai Futures exchange grew, Reuters calculations based on official Chinese data showed on Monday. China's Vice Premier Li Keqiang said the nation would stay focused on stifling inflation even as global economic uncertainties multiplied. That came after Friday's move by the world's top commodity consumer to raise bank reserve ratio rules once more as part of Beijing's effort to tame price rises. Zinc, used in galvanizing, was $2,340 from Friday's $2,325 close; lead was $2,724, from a last bid of $2,675; tin was up 1.7 percent at $29,900 and nickel was $26,725 from $26,750. Somali pirates seized a ship carrying 8,300 tonnes of ferro-nickel to Europe last week, but traders said any impact on prices would be limited other than the risk of a minor rise in European nickel premiums, currently at $200/$400 a tonne for briquettes. Nickel stocks trends are still the most bullish of the main LME metals. Latest data shows the headline figure continuing to fall, down 252 tonnes, and the ratio of cancelled tonange is a robust 6.3 percent. Metal Prices at 1043 GMT Comex copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T Metal Last Change Percent Move End 2010 Ytd Percent move COMEX Cu 433.10 0.05 +0.01 444.70 -2.61 LME Alum 2495.00 -65.00 -2.54 2470.00 1.01 LME Cu 9180.00 -330.00 -3.47 9600.00 -4.38 LME Lead 2675.00 24.00 +0.91 2550.00 4.90 LME Nickel 26750.00 0.00 +0.00 24750.00 8.08 LME Tin 29350.00 -50.00 -0.17 26900.00 9.11 LME Zinc 2325.00 0.00 +0.00 2454.00 -5.26 SHFE Alu 16695.00 55.00 +0.33 16840.00 -0.86 SHFE Cu* 71480.00 -340.00 -0.47 71850.00 -0.51 SHFE Zin 18005.00 -305.00 -1.67 19475.00 -7.55 ** Benchmark month for COMEX copper * 3rd contract month for SHFE AL, CU and ZN SHFE ZN began trading on 26/3/07 (Additional reporting by Andy Home in London and Nick Trevethan in Singapore; editing by Keiron Henderson)

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