SINGAPORE – Oil prices jumped above $77 a barrel Monday in Asia, extending gains for a second trading day after a leak forced the closure of a Chicago-area oil pipeline and  disrupted supplies to U.S. Midwest refineries.

Benchmark crude for October delivery was up 70 cents to $77.15 a barrel at late afternoon  Singapore time in electronic trading on the New York Mercantile Exchange. The contract rose  $2.20 to settle at $76.45 on Friday.

Repair crews are closing in on the source of a leak but haven't found it yet, Sam Borries,  on-scene coordinator for the U.S. Environmental Protection Agency, said Sunday. The 670,000 barrel per day pipeline run by Enbridge Energy Partners carries crude from Canada to the upper Midwest, and the supply disruption has caused a sharp spike in gas prices across that region.

"Markets tend to push higher amidst uncertainty in the process of discounting a worst  case scenario until definition is forthcoming," Ritterbusch and Associates said in a report.  "We still view a significant selloff as likely once the pipeline problem is resolved."

Oil traders took heart from accelerating Chinese industrial production, a sign the world's second-largest economy is expanding. Manufacturing rose 13.9 percent in August from a year ago, faster than the 13.4 percent growth pace in July, China said over the weekend.

In other Nymex trading in October contracts, HEATING OIL was up 1.2 cents at $2.116 a gallon and gasoline added 1.47 cents to $1.988 a gallon. Natural gas fell 3.2 cents to $3.851 per 1,000 cubic feet.

In London, Brent crude rose 49 cents to $78.80 a barrel on the ICE Futures exchange.

By ALEX KENNEDY, Associated Press Writer

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