UPDATE 2-Oil hits two-week high above $75 as equities rally

                                
 * Oil may have found a floor for a while, some traders say
                                
 * Traditional U.S. "driving season" starts this weekend
                                
 * U.S. forecasts intense 2010 hurricane season
                                
 * Coming Up: U.S. consumption for April at 1230 GMT
                                
 
                                
 (Updates throughout, previous SINGAPORE)
                                
 By Christopher Johnson
                                
 LONDON, May 28 (Reuters) - Oil touched a two-week high above
$75 on Friday, heading for its first weekly gain in almost a
month on rallying stock markets and expectations of rising U.S.
oil consumption.
                                
 Oil prices have risen more than 6 percent this week after
official data showing soaring fuel demand in top consumer the 
United States and China assured Europe remained a key investment
market for its foreign-exchange reserves. [ID:nTOE64Q04P]
                                
 Asian stocks rallied for a third day on Friday, with Japan's
benchmark Nikkei <.N225> rising more than 1.7 percent to its
highest this week and the FTSEurofirst 300 <.FTEU3> index of top
European shares up 0.6 percent in early trade. [MKTS/GLOB]
                                
 U.S. crude for July delivery <CLc1> rose as much as 90 cents
to a high of $75.45 per barrel before easing back to trade 64
cents higher at $74.19 by 0810 GMT. ICE Brent <LCOc1> was up 57
cents at $75.23.
                                
 Oil prices have been extremely volatile over the last three
weeks. U.S. crude hit an intra-day low of $64.24 on May 20 ahead
of the expiry of the June futures contract, almost $23 below its
peak at $87.15 on May 3, its level highest for 19 months.
                                
 This volatility has left many investors wary but many oil
traders argue the market may have found a floor.
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 For a graphic of the U.S. crude oil futures benchmark over
the last year, click: http://link.reuters.com/nuv86k
 ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
                                
 "We don't think we're far from the bottom," Marco Dunand,
president and chief executive of Mercuria Energy Trading told
the Reuters Global Energy Summit, adding "certain countries need
a $65-$70 kind of floor."
                                
 (For other news from the Reuters Global Energy Summit, click
on http://www.reuters.com/summit/GlobalEnergy10?pid=500)
                                
 
                                
 "FICKLE SENTIMENT"
                                
 But some analysts are cautious in the short term.
                                
 "We have seen how fickle sentiment has been over the last
few weeks and so we would rather watch the action from the
sidelines for at least another few days to see whether the
current bounce is being led by a change of perceptions, or is
merely another ill-fated short-covering rally," said Edward
Meir, senior analyst at brokers MF Global.
                                
 Traders are keeping an eye on forecasts for the Atlantic
hurricane season that have revived concerns of disruption to
supplies in the Gulf of Mexico, where BP's <BP.L> attempt to
plug a gushing oil well are continuing.
                                
 In its first outlook for the hurricane season that begins in
June, the U.S. National Oceanic and Atmospheric Administration
forecast 14 to 23 named storms, with eight to 14 turning into
hurricanes, nearly matching 2005's record of 15. [ID:nN2798815]
                                
 Hurricanes Katrina and Rita devastated offshore oilfields
and refineries across Louisiana and Texas in 2005, causing the
most severe disruption to U.S. supplies from a natural disaster.
                                
 The U.S. driving season, when motor fuel demand
traditionally reaches its annual peak, starts this weekend with
the U.S. Memorial Day holiday, running until early September.
                                
 U.S. diesel demand for trucking and industry is rising, a
weekly government report showed on Wednesday.
                                
 Oil demand in the U.S. climbed almost 7 percent over the
past four weeks, the Energy Information Administration said, led
by a 16 percent jump in demand for distillates, a category that
includes diesel and heating oil.
                                
 The U.S. economy grew at a slightly slower pace than
previously estimated in the first quarter but the recovery still
appeared solid, suggesting the economy could withstand fallout
from the European debt crisis. [ID:nN27259780]
                                
 Industry data provider Genscape on Thursday said crude
inventories at the U.S. pricing point of Cushing, Oklahoma hit
another record high in the week to May 25, rising 478,000
barrels to 39.9 million barrels, from a week earlier.
[ID:nN27272339]
 (Additional reporting by Alejandro Barbajosa in Singapore;
editing by James Jukwey)