NEW YORK, Nov 23 (Reuters) - U.S. crude oil futures rose sharply on Monday on the weak dollar, expectations for better economic growth and tensions surrounding Iran's air defense war games on Sunday. The dollar fell broadly after comments from a U.S. Federal Reserve official reinforced the view that U.S. interest rates would stay low for a long time and extended its loss versus the euro after data showed higher U.S. existing homes sales. [USD/] Selling in the dollar came as gold prices hit a record high. The euro was supported after a key survey showed the euro zone's service sector grew at its fastest pace in two years in November. [ID:nGEE5AM0RG] Iran's armed forces launched large-scale air defense war games on Sunday to demonstrate the country's deterrence capabilities in the face of pressure from the West over its nuclear program. [ID:nHAF237455] "Crude and products futures rose on moderate volume overnight after an Iranian military exercise over the weekend," Addison Armstrong, analyst at Tradition Energy in Stamford, Connecticut, said in a note that also pointed to the weak dollar. The National Association for Business Economists boosted its forecast for economic growth over the next year, but said the jobless rate will remain stubbornly high, a survey released on Monday showed. [ID:nN20235772] "The improved economic outlook by NABE for 2010 has revived the bullish fervor. Inflation worries are manifest as extremely loose economic policy runs into economic recovery. If the intent of policymakers is to inflate our way out the recession, the markets are continuing to conclude that we are on our way," said John Kilduff, partner at Round Earth Capital in New York. PRICES * On the New York Mercantile Exchange at 10:23 a.m. EST (1523 GMT), January crude CLF0 was up $2.05, or 2.65 percent, at $79.52 a barrel, trading from $77.71 to $79.92. December crude CLZ9 expired and went off the board on Friday, having settled at $76.72 a barrel, down 74 cents on the day. * In London, January Brent crude LCOF0 rose $2.12, or 2.75 percent, to $79.32 a barrel, trading from $77.55 to $79.58. * NYMEX December RBOB RBZ9 rose 4.56 cents, or 2.3 percent to $2.0262 a gallon, trading from $1.99 to $2.0341. * NYMEX December heating oil HOZ9 was up 5.72 cents, or 2.9 percent, at $2.0328 a gallon, trading from $1.98 to $2.0428. * The January/January RBOB crack spread <0#RB-CL=R> was at $6.57, after ending at $6.59 on Friday. The January/January heating oil crack spread <0#CL-HO=R> was at $7.42, after ending at $7.07 on Friday. TECHNICALS NYMEX crude 10-day/20-day moving average: $78.19/$78.52 Technical support/resistance: NYMEX crude: $75.00/$80.00 NYMEX heating oil: $1.9355/$2.0680 NYMEX RBOB: $1.9065/$2.0315 For a full report on technicals, click on [ID:nGEE5AM1AM] MARKET NEWS * Sales of previously owned U.S. homes rose in October at a faster-than-expected pace as buyers rushed to take advantage of a popular tax credit, a National Association of Realtors survey showed on Monday. [ID:nN23249040] * China's oil demand edged down in October versus September and the appetite for base metals slumped. Against year-ago levels, however, apparent oil demand was up 10.3 percent, while demand for refined copper jumped 28.6 percent. [ID:nPEK297924] (Reporting by Robert Gibbons; Editing by Walter Bagley) ((robert.gibbons@thomsonreuters.com; + 1 646 223 6059; Reuters Messaging: robert.gibbons.reuters.com@reuters.net))

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