* Tropical storm probability higher, boosts oil futures
* U.S. Q1 economic growth revised down
* Coming Up: Group of 20 meeting at the weekend (Updates trading range of U.S. crude to reflect day's high reached in post-settlement trading, paragraph 4)
By Robert Gibbons and Gene Ramos
NEW YORK, June 25 (Reuters) - Oil surged 3 percent to a seven-week high above $78 a barrel on Friday as a tropical disturbance in the Caribbean Sea looked more likely to develop into a storm and threaten Gulf of Mexico production.
Trading sources said crude futures triggered buy-stop orders during as they moved up, and a strong move up by U.S. gasoline futures also helped pull the oil complex higher.
"Today's price spike appeared to represent a combination of various items that centered around ... insertion of storm premium that proved sufficient to ignite some quantity buy stop activity at about the $77.40 area," Jim Ritterbusch, president at Ritterbusch & Associates, said in a note after the settlement.
U.S. crude futures <CLc1> for August delivery rose $2.35, or 3.07 percent, to settle at $78.86 a barrel, the highest settlement since ending at $79.97 on May 5. Crude bounced from a session low of $75.90 and traded as high as $79.19, reaching the peak in post-settlement trading on the Globex electronic trading platform after the open outcry session ended.
Crude futures ended higher a second straight day and posted a weekly gain for the third consecutive week.
ICE Brent crude futures <LCOc1> rose $1.65, or 2.16 percent, to settle at $78.12, after trading as high as $78.50.
U.S. July gasoline futures rose 7.43 cents, or 3.55 percent, to settle at $2.1678 a gallon.
"RBOB (gasoline futures) strength could be a jump start to the usual pre-July Fourth buying," said Michael Guido, associate director/hedge fund coverage at Macquarie Bank in New York.
"If this storm does become a threat, then the usual pre-holiday buy programs for gasoline will become much more expensive, hence the prompting people to act today, with shorts getting caught up in the mix," Guido added.
July heating oil also finished higher. The benchmark futures contract against which other distillates like diesel fuel are traded, rose 5.5 cents, or 2.67 percent, to settle at $2.1122 a gallon.
A tropical disturbance over the western Caribbean Sea has a high 80 percent chance of developing into a tropical depression Friday or Saturday, the U.S. National Hurricane Center said on Friday. [
]The system was expected to cross Mexico's Yucatan Peninsula over the next day or two. Weather models were divided on Friday about whether it will turn northwest toward Mexico or northeast to threaten energy production in the central Gulf of Mexico and BP Plc <BP.L> efforts to clean up its oil spill. (Graphic: http://link.reuters.com/bax24m )
U.S. crude oil and product inventories remain much higher than year-ago levels. [
] High inventories could cushion any price spikes that might result from weather-related supply disruptions. Prices jumped when hurricanes Katrina and Rita hit the U.S. Gulf of Mexico in 2005.Support for crude also came from the weakening of the dollar index <.DXY>, measuring the greenback's strength against a basket of currencies and the euro's <EUR=> recovery against the dollar.
U.S. consumer sentiment rose in June to its highest since January 2008, while reports of job losses were down sharply from a year ago, according to Thomson Reuters/University of Michigan's Surveys of Consumers. [
]Early in the session, crude oil's rise was tempered by data showing slower-than-expected economic first-quarter growth in the United States and worries about the fragility of global recovery ahead of a weekend summit of Group of 20 nations.
U.S crude oil is expected to average $79.86 a barrel in 2010, a Reuters poll showed, a slight drop from May's survey and the second consecutive lower monthly forecast after more than a year of rising expectations. [
]Front-month U.S. crude futures' $64.24 intraday low on May 20 was the weakest front-month price since $62.76 was struck on July 30, 2009. Prices recovered to a 2010 peak of $87.15 on May 3, but fell back. (Additional reporting by Rebekah Kebede in New York, Ikuko Kurahone in London, Alejandro Barbajosa in Singapore; Editing by David Gregorio)