UPDATE 9-Oil jumps $2 on economic optimism

                                
 * U.S. economy down 4th straight qtr, but at slower rate
                                
 * Refinery outages in Europe, U.S. support crude
                                
 * U.S. imports of Saudi oil down 37 pct in May vs yr ago
                                
 (Updates prices with settlements)
                                
 NEW YORK, July 31 (Reuters) - Oil rose 3.75 percent on
Friday after data showed the U.S. economy shrunk less than
expected in the second quarter, raising hopes the recession was
easing.
                                
 U.S. light crude <CLc1> traded up $2.51 to settle at $69.45
a barrel, reversing earlier losses that sent prices as low as
$64.96. London Brent crude <LCOc1> gained $1.59 cents to end at
$71.70 a barrel.
                                
 U.S. gross domestic product fell at a 1.0 percent annual
rate, the Commerce Department said, below analysts expectations
for a 1.5 percent drop.
                                
 With the contraction in the second quarter, U.S. GDP has
fallen for four straight quarters for the first time since
government records started in 1947. [ID:nN30365410]
                                
 U.S. stocks [.N] traded higher after the data, while the
dollar [USD/] fell as investors pushed into riskier plays.
                                
 "Crude futures are up as the dollar is getting trashed
while equities are starting to pick up some steam," said Tom
Knight, trader for Truman Arnold.
                                
 Optimism that demand could rise with an economic turnaround
has helped lift crude prices from below $33 a barrel in
December.
                                
 Weak demand sent oil plunging from record highs over $147 a
barrel last July, prompting the Organization of the Petroleum
Exporting Countries to cut supplies.
                                
 U.S. imports of crude from OPEC kingpin Saudi Arabia fell
37 percent versus year-ago levels in May, according to
government data released late Thursday. [ID:nN30382522]
                                
 News that British oil major BP <BP.L> shut Europe's second
largest oil refinery after a power outage, as well as the
shutdown of gasoline units in France and Germany by Total
<TOTF.PA> and a joint venture including Shell <RDSa.L>, also
bolstered prices. [ID:nLV541184]
                                
 Supplies concerns were further stoked on news Sunoco
<SUN.N> shut down a gasoline unit at its Girard Point plant in
Philadelphia for work. [ID:nN31247573]
 (Reporting by Matthew Robinson, Gene Ramos, and Robert Gibbons
in New York; Maryelle Demongeot in Singapore and Ikuko Kurahone
in London; Editing by Marguerita Choy)