UPDATE 2-Oil rises above $67 on economic recovery hopes

                                
 * Oil rises for second day
                                
 * Asia shares hit 11 month high; eyes on U.S. GDP data
                                
 * Oil still headed for first monthly fall since January
                                
 
                                
 (Previous SINGAPORE, updates throughout)
                                
 LONDON, July 31 (Reuters) - Oil climbed above $67 on Friday,
rising for a second day on renewed expectations, mainly on
equity markets, of a global economic recovery that may increase
the world's energy demand.
                                
 U.S. light crude <CLc1> was up 35 cents at $67.29 a barrel
by 0758 GMT. London Brent crude <LCOc1> gained 16 cents to
$70.27.
                                
 On Thursday, oil jumped more than 5 percent, to register its
biggest one day gain since early April, as U.S. data showed the
number of workers staying on jobless rolls fell to the lowest in
three months last week. 
                                
 The jobs data eclipsed figures on Wednesday that showed a
large increase in U.S. crude oil inventories and slow domestic
oil demand. [EIA/S]
                                
 "Short-term fundamentals are weak but prices are moving up
on expectations of an economic recovery. The market is driven by
the medium- and longer-term outlook," said Tony Nunan, risk
manager at Mitsubishi Corp. in Tokyo.
                                
 European shares rose after a dip at the opening on Friday.
[.EU] Asian stock markets rose, poised to score a double digit
gain in July. Japan's Nikkei average <.N225> hit a 10-month high
while the MSCI Asia index outside of Japan <.MIAPJ0000PUS> rose
to an 11-month high.
                                
 The market focus will shift later on Friday to the U.S.
government's advance report on second quarter gross domestic
product at 1230 GMT.
                                
 
                                
 MONTHLY FALL
                                
 Despite expectations of economic recovery, oil's
fundamentals have remained weak. Prices are poised to mark their
first monthly fall since January, which is likely to be about 4
percent.
                                
 In the United States, the world's largest consumer, crude
inventories have been on rise and oil refinery utilisation rates
have remained lower than normal. Europe's oil demand has fallen
more sharply than most other areas in the world this year.
                                
 U.S. crude oil imports in May fell to the lowest level for
the month in 12 years. In Japan, the world's third largest oil
consumer, fuel sales fell in June, dropping for the 13th
consecutive month.
 (Reporting by Maryelle Demongeot in Singapore and Ikuko
Kurahone in London)