LONDON (AFP) - Oil prices rallied Monday on positive economic data in the eurozone and Japan, while traders kept an eye on simmering tensions in crude producer Nigeria. Meanwhile, the International Energy Agency (IEA) said in a report that the world may escape an oil supply crisis for the next five years because a slow recovery from the economic downturn would hold down growth of demand. In late afternoon London trade, Brent North Sea crude for delivery in August gained 1.78 dollars to 70.70 dollars a barrel. New Yorks main futures contract, light sweet crude for August, won 1.87 dollars to 71.03 dollars. Crude prices gained following some positive data from Japan and the eurozone and news of another attack in Nigeria, said Sucden analyst Nimit Khamar in London. Japans industrial output rose for a third month running, matching the fastest pace in 56 years, as the worlds number two economy claws back from its worst recession on record, data showed Monday. Japanese manufacturers moved swiftly to idle production lines after the global economic downturn sent their exports plunging. Having succeeded in reducing their bloated stockpiles, they are now ratcheting up output again. Production rose 5.9 percent in May from the previous month, matching Aprils revised growth, which was the strongest since a record 7.9 percent increase in March 1953, according to the trade and industry ministry. In addition, the European Commssions economic sentiment indicator for the 16-nation eurozone rose to 73.3 points in June from 70.2 points, climbing further away from a record low 64.6 points reached in March. Oil prices have won support in recent weeks from hopes that the battered global economy may have turned the corner which could herald a recovery in energy demand. In Africa on Monday, Nigerian rebels announced a new raid against a Shell oil facility and said they had killed at least 20 soldiers in a gun battle, a claim denied by the security forces. While a Shell spokesman confirmed the raid and said it had caused a loss of production, a spokesman for Nigerias combined police and army joint task force (JTF) denied there had been any clash with the rebels. In Paris on Monday, the IEA slashed its mid-term estimate for world oil demand, which it said may rise by an average 0.6 percent a year in 2008-2014, down sharply from its forecast of 1.6 percent growth made last year. Relative to the medium term profiles presented in previous years, this scenario paints a delayed picture of threatened 'supply crunch later in the projected period, it said in its Mid-Term Oil Market Report. The IEA is the energy-monitoring arm of the 30-nation Organisation for Economic Cooperation and Development.