* Rumours about king's health triggered spike in oil price
* Abdullah has been resting in Morocco after U.S. surgeries
* U.S. president spoke to king on Wednesday
(Adds more from foreign minister)
By Souhail Karam
RABAT, Feb 10 (Reuters) - Saudi Arabia's King Abdullah bin Abdul-Aziz is alive and in "excellent shape", the Saudi foreign minister said on Thursday after rumours about the king's health triggered a spike in the price of oil.
Abdullah, around 87, has been resting in Morocco since January following a two-month stay in the United States where he underwent surgery twice after a blood clot complicated a slipped disc, state media have said.
"I'd like to reassure you about the health of the king. He is in excellent shape. He is undergoing therapy as you know. Doctors are suggesting a certain amount of therapy," Saudi Foreign Minister Prince Saud al-Faisal told a news conference.
"He is doing twice as much. They are suggesting a certain time for therapy. He is looking to cut it in half," he added.
The foreign minister, who is also the King's nephew, was speaking in Morocco, which he visited on Thursday after postponing a planned trip to Algeria.
"He (King Abdullah) is his usual self...and looking forward to going back to work and going back home," said Prince Saud.
An adviser to a senior member of the ruling family also said rumours of the king's death were false. Two Gulf-based diplomats said they were unaware of changes to the king's health.
North Sea Brent crude oil futures for March LCOc1 had jumped to a high of $102.88 per barrel, their highest for a week on the rumours about the health of the leader of the world's biggest oil exporter. Prices later slipped back to around $101.60 by 1410 GMT as traders discounted the rumours.
The cost of insuring exposure to Saudi Arabian sovereign obligations for five years also spiked by 19 basis points from the previous day's close.
The White House said U.S. President Barack Obama had spoken to Abdullah, a key U.S. ally, on Wednesday about the political situation in Egypt, where unrest threatens to bring down Egypt's longtime President Hosni Mubarak.
Saudi Arabia controls more than a fifth of the world's crude oil reserves. As home to Islam's holiest sites, as well as the birthplace of al Qaeda leader Osama bin Laden, Saudi Arabia is also central to global efforts to fight Islamic militancy.
Riyadh has been keen to show its allies there will be no power vacuum as health problems affect its octogenarian rulers. Since the death of the state's founder King Abdul-Aziz in 1953, the country has been ruled only by his sons.
The king of Saudi Arabia, which is also a major holder of dollar assets, came to the throne in 2005 and is the sixth leader of the OPEC state, whose political stability is of global concern.
A frail Crown Prince Sultan, another son of Abdul-Aziz who also had been away for unspecified treatment for much of the past two years, has returned to run the kingdom in Abdullah's absence.
With both Abdullah and Sultan in their 80s, speculation has arisen that Interior Minister Prince Nayef, 76 and a conservative, could take over in the future. (Reporting by Gulf bureaus)