By Eric Yep Of DOW JONES NEWSWIRES SINGAPORE (Dow Jones)--Crude-oil futures extended Thursday's gains in Asia after China released data showing inflation slowed sharply in February, indicating the world's second-biggest economy may opt for further measures to drive growth. On the New York Mercantile Exchange, light, sweet crude futures for delivery in April traded at $107.15 a barrel at 0640 GMT, up $0.57 in the Globex electronic session. April Brent crude on London's ICE Futures exchange rose $0.19 to $125.63 a barrel. China's consumer price index rose 3.2% on year in February, data from the National Bureau of Statistics showed. That was slower than the 3.4% forecast by 15 economists in a Dow Jones Newswires survey, and down from a 4.5% on-year rise posted in January. The lower-than-expected inflation reading means China's central bank has adopted the correct monetary policy, opening the way to further stimulus, which is bullish for oil markets, said Jonathan Barratt, an independent consultant with Sydney-based Barratt's Bulletin. Other indicators Friday showed economic activity slowed in China in January and February, which analysts say paves the way for further loosening of monetary policy to support growth. Value-added industrial output in China rose 11.4% in January-February from a year earlier, lagging expectations of 12.4%. Retail sales rose 14.7% in the same period, down from 18.1% in December. China, the world's largest consumer of energy, had earlier this week lowered its target for annual economic growth, weakening global oil prices. Measures to prop up growth will likely boost oil demand. Nymex oil futures closed 0.4% higher Thursday, while ICE Brent settled 1.1% higher on optimism surrounding the Greek debt swap deal. Oil markets are now eyeing U.S. February non-farm payroll report, scheduled for 1330 GMT Friday. Economists expect the U.S. added 213,000 jobs, down from a preliminary 243,000 in January, but a marked improvement from the sluggish sub-200,000 growth reported for much of last year. Employment numbers on Thursday were mixed. U.S. weekly new jobless claims rose by a higher-than-expected rate of 8,000, while analysts had expected an increase of 2,000. Earlier this week payroll processor Automatic Data Processing said the private sector added 216,000 jobs in February. Nymex reformulated gasoline blendstock for April--the benchmark gasoline contract--rose 11 points to $3.3151 a gallon, while April heating oil traded at $3.2730, 35 points higher. ICE gasoil for March changed hands at $1032.50 a metric ton, down $0.25 from Thursday's settlement. -By Eric Yep, Dow Jones Newswires; +65 6415 4063; eric.yep@dowjones.com

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