U.S. crude pricesraced above $71 a barrel, extending a 2 percent gain the day before, after rebel attacks on Nigerian oil facilities disrupted supply. Firmer oil prices supported metal prices, with gold edging above $940 to a one-week high.

Global equities were also in demand, with the MSCI world equity index advancing 0.9 percent and the pan-European FTSEurofirst 300 up 0.2 percent.

The MSCI world equity index is up more than 21 percent this quarter, on track for the biggest quarterly gain in its 20-year history.

“It is clear that the rebound in global equity markets has lost some steam,” Barclays Wealth said in a note.

“It appears to us that stocks are now broadly fairly valued, having erased their previous undervaluation faster than expected. Further share price gains may well relate more closely to the rate of underlying profit growth and the economic cycle.”

U.S. stock index futures were down between 0.2 and 0.3 percent, indicating a softer open on Wall Street.

Tokyo’s Nikkei average added 0.8 percent, shrugging off a record 1.1 percent fall in consumer prices in the year to May — another sign falling demand is pushing the economy deep into its second spell of deflation this decade.

“Most people will agree now that we won’t revisit the low point that we have seen this year any time soon,” said Luc Van Hecka, chief economist at KBC Securities.

“But there are still some problems to be resolved in the financial sector and as long as that is not out of the way in a convincing manner, we could still have intermediate corrections.”

UBS , the world’s largest wealth manager, said it planned to raise about 3.8 billion Swiss francs ($3.46 billion) by selling stock and expected to post a second-quarter net loss. The likelihood of a long road to global economic recovery remained a challenge to companies. Boeing Co , the world’s No. 2 plane-maker, suffered another heavy blow to its Dreamliner project when a major customer, Australia’s Qantas Airways , scrapped and deferred orders for 30 new planes.

DOLLAR SLIPS

The dollar fell against a basket of currencies, extending losses made the previous day after the U.S. Federal Reserve gave no hint of an imminent exit from low interest rates and other bold measures to stoke growth.

The euro was up 0.6 percent against the dollar at $1.4085, while the greenback fell 0.5 percent to the yen.

“Risk sentiment is back in full force,” said Christian Lawrence, currency strategist at RBC Capital Markets. “The dollar is being sold across the board.”

Yields on the benchmark 10-year U.S. Treasury added 2 basis points, while the 10-year euro zone benchmarkbund yield was unchanged at 3.428 percent.

In one measure of how investor sentiment has improved, the CBOE Volatility Index, a gauge of investor anxiety, on Thursday closed at its lowest level since just before Lehman Brothers filed for bankruptcy protection last September.

LONDON, June 26 (Reuters)

U.S. crude rose 49 cents to $71.76 a barrel by 1515 GMT, having topped $72 earlier. London Brent crude gained 45 cents to $71.51 a barrel.

Nigeria’s main militant group MEND said Friday it had attacked a pipeline operated by Italy’s Agip , close on the heels of previous attacks on facilities operated by Royal Dutch Shell and Chevron . Together, the attacks have cut at least 133,000 barrels of daily output.

Rebels in Nigeria, the world’s seventh-largest oil exporter, have been carrying out attacks on the oil industry for years in what they claim is a struggle aimed at spreading the region’s energy wealth to the poor local communities.

Oil prices also got support from political turmoil in Iran, the world’s fifth largest exporter, in the wake of its presidential election.

“We will see support continue to come from Iran and Nigeria. There is no immediate supply threat from Iran but in Nigeria, (there) is an actual physical disruption,” oil analyst Olivier Jakob of Petromatrix said.

Analysts said gains on Wall Street, fed by optimism that the worst of the economic recession was over, encouraged commodity buying by brightening the outlook for demand.

Oil prices have nearly doubled since February on signs of a potential economic recovery but the pace of the rally has sparked concerns prices are not well supported by fundamentals.

Adding to optimism in oil markets, the U.S. Transportation Department said on Friday Americans drove more miles in April than they did a year earlier, marking the first monthly rise in U.S. highway travel in more than a year.

NEW YORK, June 19 (Reuters)