OPEC is likely to pump more crude oil if Libyan oil supply is disrupted, to help prices move back below $100 per barrel, the head of the world's biggest oil trading house Vitol said on Tuesday.

Vitol Chief Executive Ian Taylor told an industry event during London's annual International Petroleum week that oil prices could rise further in the short term.

"There is huge and unexpected political uncertainty in most parts of North Africa and the Middle East and this can be expected to support prices," Taylor said.

But he said the Organization of the Petroleum Exporting Countries was likely to step up output if there was a sharp reduction in supply.

"We all think they (OPEC) will move quickly if there is a significant disruption in Libya," Taylor said.

"If OPEC puts more barrels into the market, as we expect to happen at some time in the first half of the year, prices should stabilize below current levels and move back to a price range around $90 to $100," he added.

Saudi Arabia's oil minister said on Tuesday the producing group was not planning to hold an extraordinary meeting as oil prices rallied to $108.50 a barrel, with unrest spreading to Libya and shutting down some ports and production facilities of the OPEC member.

OPEC ministers were set to meet representatives of top consuming nations in Riyadh on Tuesday and could have informal talks on the sidelines of the conference.

WTI

Taylor, who runs a trading business with a turnover last year of $195 billion, said predicting oil prices was "a fool's game,” particularly since a huge inflow of funds into the oil market from funds and other passive investors.

He estimated financial investments in all commodities had increased to more than $350 billion from very low levels just 10 years ago.

Taylor said a very wide spread between ICE North Sea Brent crude oil and U.S. light crude, which hit a record of more than $16.50 per barrel last week, reflected oversupply in the U.S. Midwest, the delivery point for the U.S. futures contract, known as West Texas Intermediate or WTI.

"Logistical constraints restrict how much oil can be moved out of the price-setting region (for WTI). It may take many months before any logistical changes can be made that will allow demand for WTI to increase to meet supply," he said.

He said this meant the WTI contract was "unfortunately quite compromised."

"In the short term, it means that the more reliable Brent futures contract will take centre stage, but longer term an alternative to WTI will also be needed as Brent itself is also a small volume crude," Taylor said.

He suggested the time might be right for major oil producers to consider using the Middle East Oman crude futures benchmark, which trades on the Dubai Mercantile Exchange (DME).

"There we would have a futures contract backed by the world's largest area of export crude oil, currently 20 million barrels per day," he said.