(Updates prices, adds analyst comment and changes dateline to

London)

By Eric Onstad

LONDON, April 23 (Reuters) - Copper prices retreated

from multi-week highs on Thursday on stalled U.S.-Iran peace

talks, continued closure of the Strait of Hormuz and a stronger

dollar.

Benchmark three-month copper on the London Metal

Exchange dropped 1.4% to $13,243 a metric ton by 0940 GMT after

touching its strongest since February 27 at $13,481.50.

There have been no signs of a resumption in peace talks between

the U.S. and Iran while Iran has tightened its grip on the

Strait of Hormuz, sending oil prices above $100 a barrel.

"With the Strait of Hormuz still at a standstill and the

blockade impeding fresh talks between Iran and the U.S., the

prospect of a serious energy crunch is causing fresh jitters,"

said Susannah Streeter at broker Wealth Club.

Copper climbed in the previous session along with equities

and edged higher early on Thursday on relief that the U.S. had

extended a ceasefire.

Helping to support prices are rising concerns about a

shortage of sulphuric acid, pointing to supply constraints

in copper.

China's customs data showed its sulphuric acid exports to its

biggest overseas acid market, Chile, had dried up in March, even

before reports emerged this month that China plans to ban

exports from May.

The most active copper contract on the Shanghai

Futures Exchange closed daytime trading up 0.3% at 102,780 yuan

($15,046.33) a ton, paring gains after rising as much as 1.7%.

Firmer demand in top metals consumer China has also helped

to bolster copper recently, but there are indications that could

be waning.

The premium paid over SHFE prices to buy copper in the spot

market has swung to a discount of 5 yuan per ton,

having commanded a 115 yuan premium on April 15.

Nickel was the only LME metal in positive territory after French

miner Eramet said it was planning to halt production

at its Weda Bay nickel mine in Indonesia next month.

LME nickel edged up 0.4% to $18,535 a ton and

Shanghai nickel closed 0.3% up at 141,630 yuan.

LME aluminium shed 0.7% to $3,590 a ton, zinc

dropped 1% to $3,436, lead gave up 0.4% to

$1,956 and tin was down 0.9% at $49,980.

($1 = 6.8309 Chinese yuan renminbi)