Oil rebounds above $77 on dollar weakness

* Dollar under pressure as Obama tours China

* Japan GDP jumps, but likely to slow next year

* Swelling U.S. oil stocks highlight demand weakness

By Fayen Wong

PERTH, Nov 16 (Reuters) - Oil prices clawed back some of last week's 1.4 percent losses on Monday to rise above $77 a barrel, supported by a weaker U.S. dollar and improved risk appetite.

Positive data from Japan, the world's third-largest energy consumer, whose economy expanded 1.2 percent in the third quarter from the previous three months, also lent support to oil prices.

U.S crude futures for December delivery rose 70 cents to $77.05 a barrel by 0315 GMT. The contract touched a one-month low and settled 59 cents lower at $76.35 a barrel on Friday.

London Brent crude gained 59 cents to $76.90.

"Oil prices are up mostly because of U.S. dollar weakness. The market is expecting the dollar to fall lower this week," said Jonathan Kornafel, Asia director at Hudson Capital Energy in Singapore.

The U.S. dollar drifted lower in Asia on Monday, falling 0.3 percent against a basket of currencies, as it heads into a week that is likely to see increased rhetoric on currencies from both China and visiting U.S. President Barack Obama.

A weaker dollar typically supports oil because dollar-priced commodities become cheaper for buyers using other currencies.

With the vast majority of corporate results already reported, market watchers are casting around for the next catalyst to set direction for the dollar, stocks and commodities. That will put this week's round of economic data in the spotlight, including U.S. retail sales, the Consumer Price Index and housing starts.

Hopes of a revival in energy demand from Japan also lifted prices.

Japan's economy grew at the fastest pace in more than two years in the third quarter, as stimulus lifted consumer spending and capital spending bottomed out.

However, with growth in the world's No. 2 economy largely fuelled by the continued effects of stimulus spending by governments around the world, some analysts warned the recovery may lose momentum in coming quarters due to weak domestic demand.

After having fallen about 54 percent in 2008, oil prices have rebounded nearly 73 percent so far this year, helped by a weaker dollar and rallying equities markets amid signs of stronger global growth.

Analysts said upside gains to oil prices could be limited, however, with U.S. data pointing to a choppy recovery, while bulging fuel inventories also reflected sluggish energy demand.

Crude prices fell late last week, after the U.S. Energy Information Administration reported crude and product stocks in the world's largest energy consumer rose more than expected last week.

Separately, money managers cut their net long crude oil positions on the New York Mercantile Exchange in the six days through Nov. 9, the Commodity Futures Trading Commission said. (Reporting by Fayen Wong; Editing by Clarence Fernandez)