* Shanghai copper hits three-week trough
* Nickel targets $22,000/T avg in Q4 -SocGen
* Coming up: Germany ZEW economic sentiment at 0900 GMT
(Adds detail; updates prices)
SYDNEY, Aug 12 (Reuters) - London copper steadied on Tuesday not far from six-week lows, as worries eased over geopolitical tensions in Iraq and Ukraine that could hold back global growth and dent the demand outlook for metals.
Copper prices have been hemmed in a range of $6,950-$7,210 per tonne since July, with demand cooling over the northern hemisphere summer and with a squeeze on metal supply beginning to ebb as key smelters in China and South Korea restart after maintenance.
Improving supply is setting up copper for lower prices in the months ahead, although trading conditions are likely to remain quiet in the near term, analysts said.
"It's peak summer. Volumes are thin. Moves can be exaggerated so people are reluctant to commit to too much trading activity," said analyst Mark Keenan of Societe Generale in Singapore.
Three-month copper on the London Metal Exchange had edged up 0.2 percent to $7,008 a tonne by 0710 GMT, after earlier slipping as far as $6,960 a tonne. A break below $6,951.75 would open the way to prices last seen on June 30.
The most-traded October copper contract on the Shanghai Futures Exchange slid 0.8 percent to a three-week low before cutting losses to close the session down 0.3 percent at 49,790 yuan ($8,086) a tonne.
The U.S. and global recoveries have been "disappointing" so far and may point to a permanent downshift in economic potential, U.S. Federal Reserve Vice Chair Stanley Fischer said on Monday.
Growth momentum in most major developed economies is stable although Germany and Japan both show signs of losing steam, the OECD said on Monday.
Prospects of stimulus in China have supported copper prices.
China posted mild consumer inflation on Saturday, well below the annual target in July, giving authorities room to further relax monetary policy, but deflationary pressure for producers remained stubborn, highlighting a wobbly economic rebound.
Among other metals, nickel and tin have scope for further gains as third quarter industrial activity ramps up and given China's depleting stockpiles since Indonesia banned exports of nickel ore in January, Keenan said.
Indonesia has no plans to wind back a seven-month old ban on exports of unprocessed nickel ore and bauxite that has led to billions of dollars in planned investments in smelters, top government officials said this week.
Nickel prices were targeting an average of $22,000 in the fourth quarter, according to Societe Generale, which represents a 16 percent advance from current levels of $18,875 a tonne. LME nickel has already gained 35 percent this year.
But zinc prices have already swallowed most of the year's gains based on prospects of dwindling mine supply from next year, Keenan said.
A string of large zinc deliveries into exchange warehouses in New Orleans this month and an LME positioning report that showed the market is top heavy with investment has sounded a warning bell to traders and pushed zinc prices lower, he added.
Three month LME copper
Most active ShFE copper
Three month LME aluminium
Most active ShFE aluminium
Three month LME zinc
Most active ShFE zinc
Three month LME lead
Most active ShFE lead
Three month LME nickel
Three month LME tin
(1 US dollar = 6.1558 Chinese yuan) (1 US dollar = 6.1578 Chinese yuan)
(Reporting by Melanie Burton; Editing by Richard Pullin, Joseph Radford and Subhranshu Sahu)