OPEC may raise oil output later in year

OPEC may act to raise oil output later this year if the group decides to keep production steady at its meeting in September, an OPEC delegate said on Wednesday.

High oil prices were damaging OPEC's image in the market as winter approached and crude stocks were falling, the delegate told Reuters.

"If OPEC is not taking immediate action to increase it may want to give the message that it will do something later," the delegate said.

"Maybe to reassess the market after Ramadan. The high price is not publicly good for OPEC, especially as winter approaches and stocks draw down."

The Muslim holy month of Ramadan was expected to end in mid-October.

Libya's top oil official said on Wednesday it saw no need for the Organization of the Petroleum Exporting Countries (OPEC) to change supply at its September 11 meeting in Vienna.

The comments were the latest indication that OPEC, supplier of more than a third of the world's oil, was unlikely to pump more despite consumer calls to boost output.

OPEC has scheduled a further meeting to discuss output on December 5 in Abu Dhabi. Oil ministers will also meet ahead of an OPEC member heads of state summit in Riyadh on November 17.

OPEC may want to show it is mindful of the worsening credit conditions in top oil consumer the United States, analysts say.

US crude futures have fallen to around $70 a barrel from a high of $78.77 on August 1, in part because of concern the credit crunch will cause a wider economic slowdown.

US crude stocks have fallen for six consecutive weeks, although government data last week showed they were still higher than a year ago.