Portugal Colonial - Oil pares gains as shares rise in Tokyo, Seoul

Many markets in Asia and Europe were closed for holidays on Easter Monday, which coincides with China's Qingming Festival.

Crude oil contracts had surged at the week's market opening after US President Donald Trump made an expletive-laced threat to destroy Iran's civilian infrastructure, demanding Tehran bow to his demands for a deal to reopen the Gulf to shipping.

But they fluctuated during the day, and by late afternoon US benchmark West Texas Intermediate had lost 0.7 percent at $110.75 a barrel, while North Sea Brent was up 0.2 percent to $109.20.

Analysts said a report by Axios that said the United States and Iran were discussing terms with regional mediators for a potential 45-day ceasefire had calmed sentiment among investors.

"Markets are beginning to flirt with the idea of a peace dividend," wrote Stephen Innes at SPI Asset Management.

However, it is "a tentative recalibration, a market shading probabilities rather than rewriting the script", Innes added.

Bloomberg Markets Live strategist Mark Cranfield said the reaction to the report "shows how keen investors are to see a de-escalation in the Iran war, which is dominating a risk aversion theme across markets".

"Should President Trump push back against ceasefire hopes when he speaks later on Monday, this positive mood will reverse," he added.

Tokyo closed 0.6 percent higher and Seoul ended the day with gains of 1.4 percent. Among other Asian markets open on Monday, Singapore was up 0.4 percent but Jakarta was down 0.5 percent.

"Tuesday will be Power Plant Day, and Bridge Day, all wrapped up in one, in Iran. There will be nothing like it!!!" Trump wrote on his Truth Social platform Sunday, later telling Fox News there was a "good chance" Iran would agree to a deal.

Hours later, Iran's central military command warned of "much more devastating" retaliation if its adversaries hit civilian targets.

MUFG's Lloyd Chan said in a note that "it remains to be seen whether this escalatory rhetoric ultimately proves to be another 'TACO' moment" -- a jokey acronym for "Trump always chickens out".

But "the persistence of threats to critical Iranian infrastructure keeps escalation risks elevated", he said.

The war, entering its sixth week since the US and Israel first attacked Iran on February 28, has engulfed the Middle East in conflict and upended the global economy.

Iran has virtually blocked the Strait of Hormuz, through which about 20 percent of the world's oil and gas transits, sending petroleum prices skyrocketing.

- Key figures at around 0730 GMT -

Tokyo - Nikkei 225: UP 0.6 percent at 53,413.68 (close)

Hong Kong - Hang Seng Index: CLOSED for holiday

Shanghai - Composite: CLOSED for holiday

Euro/dollar: UP at $1.1544 from $1.1535 on Friday

Pound/dollar: UP at $1.3229 from $1.3224

Dollar/yen: FLAT at 159.63

Euro/pound: UP at 87.27 pence from 87.22 pence

West Texas Intermediate: DOWN 0.7 percent at $110.75 per barrel

Brent North Sea Crude: UP 0.2 percent at $109.20 per barrel

New York - Dow: DOWN 0.1 percent at 46,504.67 (close)

London - FTSE 100: CLOSED for holiday

S.Caetano--PC