* Oil & gas stocks log best day since Jan 2019
* China industrial output growth weakens in August
* Energy-heavy Norway shares rise, airlines drop(Updates to close)
By Sruthi Shankar
Sept 16 (Reuters) - Oil and gas companies stood out in agloomy session for European stock markets on Monday as an attackon Saudi Arabia's oil facilities thrust crude prices higher,while heightening geopolitical concerns among investors.
The oil & gas index surged 2.8% to log its biggestpercentage gain since January 2019, after the weekend's attackon the world's largest crude exporter disrupted more than 5% ofglobal oil supply.
Oil prices soared as much as 20%, with Brent crudeposting its biggest intraday gain since the 1990-1991 Gulfcrisis before easing off its peaks.
That helped energy-heavy Norwegian stocks jump1.65%, boosted by Equinor and Aker BP, thetop gainer on STOXX 600.
Oil majors BP, Shell and Totaljumped between 2.5% and 4%, while UK and Irish-based explorerTullow Oil gained 8.4% after the firm said it plans todrill three or more exploration wells in Guyana.
Most other major European sectoral indexes fell, with sharesin Airbus and French luxury goods exporters sliding asthe European Union acknowledged it may face U.S. tariffs in along-running dispute over aircraft subsidies.
Airbus shares dropped 3.4%, while LVMH, ChristianDior and Hermes fell between 2.8% and 4.5%.
"Despite a strong lift for oil stocks, the larger, moreliquid, higher-capitalisation indices in western Europe with thestrongest global links were all weak," City Index's Ken Odelugawrote in a note.
"It looks like investors assess the situation as havingpotential to further weigh on a geopolitical landscape alreadybeset by the slowing global economy, Brexit and trade."
The Iran-aligned Houthi group that controls Yemen's capitalclaimed responsibility for the attack, although a Saudi-ledcoalition said on Monday the attacks were carried out withIranian weapons.
President Donald Trump said Washington was "locked andloaded" to hit back.
Adding to some weak indicators from China last week,industrial production in the world's second largest economy grewat its weakest pace in 17-1/2 years in August.
The pan-European STOXX 600 index ended down 0.6%,ending a four-day winning streak, while trade-sensitive Germanshares dropped 0.7%.
The weekend's events halted a march higher in Europeanstocks, which logged their fourth week of gains on Friday asinvestors moved back into cyclical sectors amid signs ofprogress in U.S.-China trade talks.
After the European Central Bank cut rates deeper intonegative territory last week and relaunched bond purchases withno scheduled end-date, all eyes are now on the U.S. FederalReserve's policy meeting this week.
The central bank is widely expected to ease interest ratesand signal further moves.
Travel and leisure stocks dropped 0.6%, dragged downby shares of airlines Ryanair Holdings, Air France KLMSA and EasyJet PLC on worries of higher fuelcosts hurting profits.
Shares in Italian infrastructure group Atlantiaslid another 8% after Italy's tax police said they had foundevidence that safety reports for some viaducts operated byAtlantia's motorway unit had been falsified or informationomitted.(Reporting by Sruthi Shankar in Bengaluru; Editing by JanHarvey)
