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GLOBAL MARKETS-Oil surges to over two-year peak; shares near flat

* Oil jumps to over 2-year high

* Nasdaq hits another record high; dollar in tight range (Updates market indexes, adds Dudley)

NEW YORK, Nov 6 (Reuters) - Oil prices surged to their highest since July 2015 on Monday as Saudi Arabia's crown prince cemented his power with a crackdown on corruption, while shares worldwide were little changed and key currencies stayed in tight ranges.

U.S. crude broke above $56 a barrel for the first time in more than two years as Mohammed bin Salman's clampdown on graft led to arrests of royals, ministers and investors including prominent billionaire investor Alwaleed bin Talal. Brent crude futures were trading more than 3 percent higher at $64.03 a barrel by 1:30 p.m. Eastern time (1830 GMT).

Prince Mohammed's reforms include a plan to list parts of state-owned oil company Saudi Aramco next year, with higher oil prices seen as beneficial for the market capitalization of the future listed company.

The news spurred concerns of Middle Eastern money pulling out of global financial markets. A weekend call by China's central bank governor for tougher financial regulation also hit global investor sentiment.

The MSCI world equity index, which tracks shares in 47 countries rose 0.2 percent.

The pan-European STOXX 600 closed 0.13 percent higher. Saudi Arabia's own stock market fell as much as 1.5 percent before ending 0.1 percent higher, boosted in part by buying by government-linked funds.

Sentiment towards the U.S. dollar was still positive with leveraged funds paring bearish bets to be net long for the first time since late July.

"There is some ongoing adjustment in market expectations on the dollar's outlook on the progress of the U.S. tax bill and on the ongoing Saudi situation but market moves have been in narrow ranges," said Alberto Gallo, head of macro strategies at Algebris Investments in London.

NASDAQ AT PEAK

Wall Street's three key equity indexes rose slightly in afternoon trading, with investors focused on what could be the biggest merger in the technology sector.

The tech-heavy Nasdaq Composite Index hit a new record high above 6,765.12 on news that chip maker Broadcom Ltd made an unsolicited bid to buy peer Qualcomm Inc for $103 billion.

The market was otherwise muted. The Dow Jones Industrial Average rose 22.84 points, or 0.1 percent, to 23,562.03, while the S&P 500 gained 3.79 points, or 0.15 percent, to 6,783.06.

The U.S. dollar was little changed after investors took profits on its best weekly performance this year, with wariness about the status of the U.S. economy and tax reform plans setting the tone.

Facing pockets of discontent in their own Republican ranks, tax negotiators in the U.S. House of Representatives will seek to bridge differences over their far-reaching tax bill and stick to a self-imposed deadline of passage this month.

The index that measures the greenback against a basket of currencies fell 0.18 percent, with the euro up 0.02 percent to $1.1609.

The Japanese yen strengthened 0.19 percent versus the greenback at 113.85 per dollar, while sterling was last trading at $1.3153, up 0.60 percent on the day.

The spread between two-year and 10-year U.S. Treasury yields was the narrowest in more than a decade as sluggish domestic inflation underpinned demand for longer-maturity government bonds.

Benchmark 10-year Treasury notes were last up 7/32 in price to yield 2.3199 percent, from 2.343 percent late on Friday. The Federal Reserve confirmed Monday that William Dudley, one of the most influential monetary policymakers throughout the 2008 financial crisis and its aftermath, expects to retire by mid-2018, leaving the leadership of the U.S. central bank unusually wide open.

The 30-year bond was last up 15/32 in price to yield 2.798 percent, from 2.822 percent late on Friday.

Spot gold was up 0.24 percent at $1,272.04 an ounce.

For Reuters Live Markets blog on European and UK stock markets see reuters://realtime/verb=Open/url=http://emea1.apps.cp.extranet.thomsonreuters.bi z / c m s / ? p a g e I d = l i v e m a r k e t s

(Editing by Jennifer Ablan and James Dalgleish)