Oil jumps above $75 as equities rally; U.S. supplies drop

                                
 * U.S. crude stocks fell 7.3 million barrels -API
                                
 * Coming Up: EIA U.S. inventory report; 1500 GMT
                                
 * For a technical view, click [ID:nSGE66700W]
                                
 By Alejandro Barbajosa
                                
 SINGAPORE, July 8 (Reuters) - Oil jumped to a one-week high
above $75 on Thursday after earnings euphoria injected positive
sentiment into Asian equities, reinforcing overnight gains
triggered by an industry report showing U.S. crude inventories
plunged last week.
                                
 The euro surged to a two-month high and Asian stocks
climbed to their highest in more than a week on Thursday after
a bullish forecast from State Street <STT.N> a day earlier
fuelled optimism about the coming U.S. earnings season and
underpinned growing tolerance for risk, sending Wall Street
higher. [MKTS/GLOB]
                                
 "The fear over a double dip recession or something more
dramatic has eased a little bit from a month ago," said Yingxi
Yu, a Singapore-based commodities analyst with Barclays
Capital.
                                
 "Market sentiment remains a very important driver. Oil
really follows equity markets and other risky assets."
                                
 U.S. crude for August <CLc1> rose as much as $1.03 or 1.4
percent to $75.10 a barrel, the highest intraday price since
July 1, and was up 76 cents at $74.83 by 0258 GMT on the New
York Mercantile Exchange. ICE Brent crude for August <LCOc1>
rose 68 cents to $74.19.
                                
 Oil prices are still more than $12 away from a 19-month
peak above $87 reached in early May, though they have rebounded
by about $10 from a trough below $65 on May 20.
                                
 FUNDAMENTAL SUPPORT
                                
 Crude inventories in the United States tumbled by 7.3
million barrels last week, the American Petroleum Institute
reported late on Wednesday, more than three times the expected
drop.
                                
 "We have seen a very quick response in the market,"
Barclays' Yu said. "Perhaps it's a reflection of the temporary
closures on the U.S. Gulf coast due to hurricane Alex."
                                
 Stockpiles fell after Hurricane Alex forced some producers
in the U.S. Gulf to curb production and Mexico to close loading
terminals that send most of their output to U.S. refiners.
                                
 A tropical depression could form over the northwestern Gulf
of Mexico before reaching the Texas-Mexico border on Thursday,
a region still recovering from Alex, the U.S. National
Hurricane Center said late on Wednesday. [ID:nN07265080]
                                
 Government statistics on U.S. oil inventories and demand
from the Energy Information Administration follow the API data
on Thursday at 1500 GMT.
                                
 "We have to wait and see what the EIA tells. If it's a
confirmation, it would provide support to the market in the
short term," Yu said.
                                
 Expectations are for crude stockpiles to have dropped 2.3
million barrels, according to a Reuters survey.
                                
 Gasoline stocks fell 191,000 barrels, the API said, in line
with analysts' projections, while distillates including heating
oil and diesel fell 1 million barrels, contrary to a forecast
for a 1.4 million-barrel gain. [API/S]
                                
 BP <BP.L> <BP.N> boss Tony Hayward met with an Abu Dhabi
state investment fund on Wednesday, part of a quest for cash to
ward off takeovers and help pay for the worst oil spill in U.S.
history. [ID:nLDE6660B7]
 (Editing by Clarence Fernandez)