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NYMEX-US crude hits 9-month high amid Iraq unrest

SINGAPORE, June 13 (Reuters) - U.S. crude futures rose by more than a dollar on Friday to the highest in nearly nine months amid upheaval in Iraq that threatens to disrupt supply from the second biggest OPEC producer.

U.S. oil prices have gained almost 5 percent for the week, on track for their biggest weekly increase this year.

FUNDAMENTALS

* U.S. crude for July delivery rose as much as $1.15 to $107.68 per barrel, its loftiest since Sept. 19, 2013. It was up 79 cents at $107.32 by 0037 GMT, and up 4.5 percent for the week, its largest such gain since early December.

* Brent oil touched a session peak of $113.75 per barrel, its highest since Sept. 9 last year. It was last up 50 cents at $113.52, putting its weekly gain at 4.4 percent so far, the biggest since July 2013.

* President Barack Obama threatened U.S. military strikes in Iraq against Sunni Islamist militants who have surged out of the north to menace Baghdad and want to establish their own state in Iraq and Syria.

* Top U.S. weapons maker Lockheed Martin Corp said it was evacuating about two dozen employees from northern Iraq due to security concerns, and the U.S. State Department said other companies were relocating their workers as well.

* The violence in Iraq may put at risk projections by the Organization of the Petroleum Exporting Countries for extra supply. OPEC said oil markets should be balanced during the second half of this year with extra production sufficient to meet growing demand.

* Asia's diesel demand is expected to grow this year at the second-lowest rate since the 1998 financial crisis as slowing economies and subsidy cuts squeeze consumption and help build a surplus for which there are few markets.

* Chinese state-run oil trader Zhuhai Zhenrong Corp has entered a one-year supply agreement to buy Iranian South Pars condensate, in its first term contract for the light crude oil with the Middle East supplier, according to industry officials.

MARKETS NEWS

* The dollar steadied in Asian trading but remained near two-week lows against the yen after tensions rose in Iraq and downbeat U.S. economic data gave investors no reason to believe the Federal Reserve will be raising interest rates anytime soon. Asian equities fell.

DATA

* The following data is expected on Friday: (Time in GMT)

0530 China Industrial output May

0530 China Retail sales May

0530 China Urban investment May

0900 Euro zone Employment Q1

0900 Euro zone Eurostat trade April

1355 U.S. Univ of Michigan sentiment index June

(Reporting by Manolo Serapio Jr.; Editing by Richard Pullin)