* Oil surges to above $73 before trimming gains
* Trade volume more than 10 times Asia norm, Brent in focus
* End-quarter fund covering may be behind sudden move
* U.S. crude inventory data eyed on Tuesday, Wednesday
(Updates throughout, previous PERTH)
By Joe Brock
LONDON, June 30 (Reuters) - Oil prices rose above $72 a
barrel on Tuesday, paring gains after earlier jumping more than
2 percent on unprecedented Asian trading volumes.
Trades in Brent and then U.S. crude oil futures surged to
more than 10 times the norm for the Asian time zone as prices
leapt more than $1.50 in under half an hour around 0200 GMT.
The jump was led by a sudden spike in Brent buying pinned on
fund positioning.
Both prices and volumes cooled in London trade, with U.S.
crude for August delivery <CLc1> up $1.08 at $72.57 a barrel by
0822 GMT, off its earlier eight-month high of $73.38.
Brent was up $1.09 to $72.08 a barrel.
Some traders attributed the leap in prices and volumes in
Asia to big fund players in the market.
"This could be end of quarter movement, and traders are
trying to push prices higher and then selling before closing
their books," said Mark Pervan, senior commodities analyst at
ANZ Bank. "I haven't seen any new catalyst on the news front."
Oil prices were also supported by a weaker U.S. dollar on
Tuesday, which can make commodities denominated in the currency
more attractive to investors.
Unrest in Africa's top producer Nigeria has helped to
underpin oil's gains this week as it increases expectations of a
tightening of oil supplies from the region.
The country's main militant group said on Monday its
fighters had attacked an oil facility belonging to Royal Dutch
Shell <RDSa.L> days after President Umaru Yar'Adua proposed an
amnesty. []
OIL RALLY
Driven by hopes of a global economic recovery, oil prices
are on track to post a near 50 percent increase in the second
quarter, the highest quarterly percentage gain since 1990.
Oil has rallied on hopes for an improving economic outlook
and a growing appetite for risk among investors, a factor given
further impetus by Asian and U.S. stock market gains.
Later on Tuesday the focus will turn to crude and oil
products inventory numbers from the United States for the latest
indication of demand from the world's biggest fuel consumer.
A Reuters poll of analysts ahead of weekly data forecast
U.S. crude stockpiles fell by 1.6 million barrels last week,
while gasoline stocks were seen up 2 million barrels and
distillate stocks rose 1.5 million barrels. []
The American Petroleum Institute will release its weekly
U.S. inventory at 2030 GMT, while the U.S. Energy Information
Administration report is due out on Wednesday.
(Additional reporting by Fayen Wong; Editing by James Jukwey)
