UPDATE 7-Oil up on Iran tension, US gasoline futures jump

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* U.S. gasoline futures hit highest since April

* Coming up: U.S. Oct fuel futures contracts expire Friday (Recasts, updates trading)

By Robert Gibbons and Adam Kerlin

NEW YORK, Sept 27 (Reuters) - Oil rose on Thursday as tensions between Iran and the West stoked concerns about supplies, while refinery maintenance and low inventory levels sent U.S. gasoline futures to their highest since April.

Hopes for Chinese government action to bolster the giant Asian economy's slowing growth and a drop in U.S. jobless claims last week helped lift U.S.

"Oct fuel futures contracts expire Friday (Recasts, updates trading)By Robert Gibbons and Adam KerlinNEW YORK, Sept 27 (Reuters) - Oil rose on Thursday as tensions between Iran and the West stoked concerns about supplies, while refinery maintenance and low inventory levels sent U.S"equities, snapping a five-day string of losses and lending additional support to oil.

Crude futures and the euro received a boost from remarks by Spain's Economic Minister Luis de Guindos saying that Spain's reform work was fully coordinated with the European Union framework and its recommendations on budget control.

Israeli Prime Minister Benjamin Netanyahu, in a speech to the United Nations on Thursday, will "set a clear red line" and "clarify the way in which Iran won't have nuclear arms," a senior Israeli official said.

Comments from Iranian President Mahmoud Ahmadinejad that his country was capable of "neutralizing" all efforts to sabotage its nuclear facilities limited oil's losses on Wednesday and lent support in early Thursday trading.

"Nothing has improved in the relationship between Iran and Israel and there is unpleasantness throughout the Middle East," said David Morrison, analyst at GFT Global. "The danger is that we have a nasty flare-up."

Brent November crude rose $2.09 to $112.13 a barrel by 1:02 p.m. EDT (1702 GMT), after earlier reaching $112.40.

Brent moved back above its 50-day moving average of $111.61 and the 200-day moving average of $112.02, technical levels closely watched by traders.

Set to snap a string of three lower settlements, U.S. November crude was up $1.97 at $91.95 a barrel, having traded as high as $92.30, and advancing above its 100-day moving average of $90.21.

Brent's premium to U.S. crude CL-LCO1=R increased to $20.84 during the session, after moving above the $20 level on Wednesday for the first time since Aug.

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GASOLINE RALLIES

U.S. October RBOB gasoline futures were up 8.54 cents at $3.1665 a gallon, after reaching $3.2086, the highest price since futures reached $3.2103 on April 30.

October gasoline and heating oil contracts expire on Friday.

The oil futures complex received support from Wednesday's government data showing U.S. crude and refined product inventories fell last week.

U.S. gasoline inventories lost 481,000 barrels, compared with expectations they would be up slightly, leaving total U.S. stocks and East Coast inventories at their lowest since October 2008, the Energy Information Administration said.

Seasonal maintenance at refineries on both sides of the Atlantic also supported product futures.

"The market is very tight right now, whether you look at the Gulf Coast or New York Harbor because of a rash of refinery issues across the globe," Phil Flynn, an analyst at Price Futures Group in Chicago, said.

(Additional reporting by Adam Kerlin in New York, Peg Mackey in London and Manash Goswami in Singapore; Editing by Dale Hudson and Bernadette Baum)

Energy.