(Updates prices, adds trader quote, updates milestone)

* Oil up more than $1 after Saudi's Asia price hike

* Palm oil to test resistance at 2,218 rgt -technicals

* CPO prices to average lower at 2,170 rgt/t between

 Malaysian palm oil futures rose on Monday for a third straight session to reach their highest in more than three weeks, lifted by rising crude oil and firm U.S. soyoil prices, traders said.

Oil futures climbed more than $1 a barrel on Monday, after

Saudi Arabia raised its prices for crude sales to Asia for the

second month running, signalling improved demand in the region.

When markets re-opened after the Easter holiday, Brent crude

touched a high of $56.90 a barrel and U.S. crude

rose as much as to $50.97.

Higher crude prices could attract interest for palm-based

biodiesel.

The benchmark June contract on the Bursa Malaysia

Derivatives rose 1.9 percent to 2,233 ringgit ($614) a tonne

after touching 2,250 ringgit, its highest since March 13.

But some traders said a sharp rise in late Monday trade was

"abnormal" and the contract lacked fundamental domestic support.

The Malaysian ringgit, which typically curbs buying interest for

the ringgit-priced palm as it advances, strengthened to near a

five-week peak of 3.6205 per dollar.

"Prices are very much overdone on the higher side for the

day, knowing the weakness from the strong ringgit," said a

trader with a foreign commodities brokerage in Kuala Lumpur.

"We're hoping that our 10- and 15-days exports will provide us a

clear price direction."

Total traded volume stood at 46,555 lots of 25 tonnes, above

the average 35,000 lots.

Investors are also watching Indonesia's plans to impose

levies on its exports of CPO and processed palm oil to fund its

biodiesel mandates. The levies, which will come into effect

after being signed by President Joko Widodo, may spur some

initial demand for crude palm from neighbouring Malaysia.

The U.S. soyoil May contract gained 1.3 percent in

late Asian trade, lending support to palm oil, a common food and

fuel substitute.

However, analysts say that softening demand for palm oil,

alongside another record global soybean harvest, may put

pressure on the tropical oil.

"In line with the softer CPO price outlook, we estimate CPO

prices from April-Dec 2015 should average lower at 2,170 ringgit

per metric tonne in keeping with our 2,200 ringgit full-year

forecast," Kenanga Investment Bank said in a note on Monday.

Palm, soy and crude oil prices at 1029 GMT

Contract Month Last Change Low High Volume

MY PALM OIL APR5 2240 +62.00 2214 2240 58

MY PALM OIL MAY5 2241 +45.00 2204 2256 5732

MY PALM OIL JUN5 2230 +39.00 2197 2250 24711

CHINA PALM OLEIN SEP5 4660 -2.00 4660 4660 73414

CHINA SOYOIL SEP5 5372 -14.00 5372 5372 73934

CBOT SOY OIL MAY5 31.41 +8.60 30.93 31.52 4540

INDIA PALM OIL APR5 444.70 +8.60 438.40 447.00 1579

INDIA SOYOIL APR5 605.10 +14.85 592.80 605.90 31155

NYMEX CRUDE MAY5 50.65 +1.51 49.47 50.97 35996

Palm oil prices in Malaysian ringgit per tonne

CBOT soy oil in U.S. cents per pound

Dalian soy oil and RBD palm olein in Chinese yuan per tonne

India soy oil in Indian rupee per 10 kg

Crude in U.S. dollars per barrel

($1 = 3.6300 Malaysian ringgit)

($1 = 6.1950 Chinese yuan)

($1 = 62.20 Indian rupee)