Oil prices edged higher in Asian trade on easing concerns about a sharp economic slowdown in China, the world's biggest energy user. However, economic and political uncertainty in Europe capped prices and a weaker euro was helping dampen demand for dollar-priced crude. New York's main contract, West Texas Intermediate crude for delivery in June was up six cents to $103.17 a barrel. Brent North Sea crude for June gained 14 cents to $118.85. Oil prices had slipped yesterday after an HSBC purchasing managers' index showing China's manufacturing activity contracted for a sixth month in a row in April. Analysts, however, said there was a silver lining in the data that indicated recovering demand in the world's second largest economy. The PMI reading was 49.1 in April, up from 48.3 in March, denoting an improvement but no return to expansion just yet. A reading below 50 indicates contraction while anything above 50 shows growth. Political and economic uncertainty in Europe also remained a bearish factor, analysts said. Spain - one of the euro zone's beleaguered economies - said yesterday that it had plunged back into recession in the first quarter of 2012. Investors were also spooked by the collapse of the Dutch government, a day after French President Nicolas Sarkozy lost a first-round presidential vote to Socialist Francois Hollande.

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