TOKYO, July 21 (Reuters) - U.S. crude futures rose above $64 a barrel on Tuesday, extending the previous day's gains, when a weak dollar and optimism reflected in stronger equities markets boosted oil prices. FUNDAMENTALS * U.S. oil prices CLc1 settled up 0.7 percent on Monday as stock markets extended gains from last week on strong corporate earnings and news of a rescue package for troubled U.S. lender CIT Group. [ID:nSYD403861] * OPEC will need to cut output when it next meets in September if there is not enough demand for its oil, Algeria's energy and mines minister said on Monday. [ID:nLK43940] * A Reuters poll of analysts released ahead of weekly U.S. inventory data forecast crude stockpiles fell by 1.8 million barrels in the week to July 17, which would mark the seventh straight week of declines. [EIA/S] The American Petroleum Institute (API), an industry group, will release its data later on Tuesday, while a weekly report from the U.S. Department of Energy is due out on Wednesday. MARKETS NEWS * Japan's Nikkei stock average rose 1.8 percent on Tuesday after revived hopes of a U.S. economic recovery helped Wall Street rise the previous day, with a deal to rescue U.S. lender CIT Group buoying the financial sector. [.T] * The dollar pared loses against the euro on Tuesday, after hitting a six-week low against the currency on Monday, when strong U.S. corporate earnings prompted investors to plunge back into high-yielding currencies and other risky assets. [FRX/] * Copper prices rose 2 percent to hit nine-month highs on Monday, leading a broad rally in commodities, after an index of leading economic indicators suggested the U.S. recession was drawing to a close. [ID:nN20364758]

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