VIENNA: Steady crude prices and an upbeat view of the oil market reassured ministers of the OPEC producers' cartel as they prepared to meet on Wednesday, set to hold output steady despite a mixed economic outlook.

An OPEC production-monitoring committee said it would formally recommend no change to output at Wednesday's meeting, which was to start late in the evening due to the Muslim fast of Ramadan.

The committee urged moves to boost compliance with agreed cuts instead, Kuwait's Oil Minister Sheikh Ahmad Abdullah al-Sabah told reporters late Tuesday as ministers gathered in Vienna.

Saudi Oil Minister Ali al-Naimi -- whose country is the biggest OPEC oil producer -- said: "The market is in very good shape, very well supplied," as he arrived ahead of the meeting.

"The price is good for everybody, consumer (and) producer," so further cuts to output are not needed, he said.

A vicious global economic downturn has sapped demand for energy, dragging crude prices from record highs of above 147 dollars in July 2008 to 32.40 dollars in December. They have since recovered to hover around 70 dollars.

Now ministers from OPEC countries, which are highly dependent on oil exports, must steer a careful course, supporting prices but not alarming markets by trying to do so too aggressively.

Qatar's Energy Minister Abdullah bin Hamad al-Attiya sounded a note of caution, saying the outlook for oil demand was "very gloomy" and uncertain.

"I don't think now is the right time to cut production," he told reporters here. "We don't want to damage the world economy."

His Algerian counterpart Chakib Khelil forecast that prices would continue to strengthen, despite widespread economic uncertainty.

"There will be a lot of volatility, because of the uncertainties with the economy," Khelil told reporters as he arrived in Vienna.

But he added that recent firmer prices would be sustained, "and by early next year we should see prices rising" further.

OPEC, whose 12 members pump 40 percent of the world's oil, agreed in late 2008 to remove a massive 4.2 million barrels of daily output from the market as it sought to prop up crumbling prices.

The cartel's official daily output quota has stood at 24.84 million barrels per day since January but analysts say that compliance with the cuts has slipped over recent months.

They blame overproduction mainly on Iran as well as on Angola, the current holder of the OPEC presidency, and Venezuela -- regarded as hawks with a strong desire for stronger prices.

Several ministers pointed to high levels of crude stockpiles, which can depress prices, especially when demand is weak. Khelil insisted OPEC's cuts were helping to curb the glut, however.

"Inventories are growing," he said, but thanks to OPEC's measures, "things will stabilise within the next six months. So I don't think the stocks will continue rising at least."

Analysts say most member countries are satisfied with prices in the range of 70 to 80 dollars, enough to fund investment in future production.

Oil fell in Asian trade Wednesday after overnight gains spurred partly by a weakening US dollar, but analysts said the dip would likely be temporary.

"A weak dollar spreads the idea that oil can be a hedge against the dollar," said Bart Melek of BMO Capital Markets. "We're talking about stronger economic performance now and oil is one of the commodities that benefits from that."

New York's main contract, light sweet crude for October delivery eased two cents to 71.08 dollars.

Brent North Sea crude for October delivery was 20 cents lower at 69.22 dollars.