* China domestic copper premiums surge on tight credit conditions * U.S. pending home sales for March due 1400 GMT (Recasts, adds analyst's comment; updates prices) By Maytaal Angel and Melanie Burton LONDON/SINGPORE, April 28 (Reuters) - Nickel hit its highest level in 15 months on Monday as investors continued to price in the effects of Indonesia's ban on unprocessed ore exports, while copper extended last week's gains to hit a seven-week high. Nickel has gained some 35 percent this year following the Indonesia ban this January. Also boosting its price are fears of outright war in Ukraine and worries that the West will impose harsher sanctions on Russia, a major producer of refined nickel. Heavily armed pro-Russian separatists, who Kiev and the West believe are backed by the Kremlin, have proclaimed an independent "people's republic" in the eastern Ukrainian city of Donetsk, while holding several European monitors hostage. "Russia and Ukraine are creating noise ... (nickel) is pricing in lots of disruptions this year. Should Indonesia hold on to its ban and not give exemptions, then these gains are likely to be upheld," Commerzbank analyst Eugen Weinberg said. LME nickel rose as high as $18,715 a tonne, its highest since Feb. 6, 2013, and was trading at $18,513 a tonne at 1010 GMT, up 0.4 percent. In other metals, copper found support from tight credit in top consumer China, where consumers were low on stocks but unable to finance new purchases due to a government crackdown on lending. Three-month copper on the London Metal Exchange climbed to $6,798 a tonne, its highest since March 7, before trading at $6,764.50 a tonne, down 0.01 percent. Prices have rebounded by more than 2 percent this month but are still down by nearly 8 percent this year. Traders estimated that bonded stocks in Shanghai were sitting at around 800,000 to 850,000 tonnes but said these supplies were not easily available to local manufacturers because of curbs on credit. "People thought the crackdown on LCs (letters of credit) would be bearish for copper because it would result in less imports. Actually it has turned out to be bullish," one Chinese trader said. While supplies were constrained, China's demand for copper rose for seasonal reasons and due to purchases by China's State Reserves Bureau (SRB), which sources said had bought at least 200,000 tonnes of bonded copper after global prices hit multi-year lows in March. The premium for domestic copper prices surged above 1,000 yuan ($160) last week, the highest in almost a year, before easing to around 530 yuan on Monday, up from a discount at the start of March. China aims to start building more than 7 million units of public housing this year, the Ministry of Housing and Urban-Rural Development said on Saturday, signalling the latest government move to counter high property prices. Hedge funds and money managers trimmed their net shorts in copper in the week to April 22, according to data from the Commodity Futures Trading Commission on Friday.

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