Libya's oil chief called on oil producing nations Thursday to cut output and said OPEC was thinking about holding an emergency meeting next month to tackle the slump in global crude prices.

Oil prices have fallen about 40 percent from a record high of more than US$147 per barrel in July. The decline to about US$89 per barrel has been driven by falling demand in the U.S. and other industrialized nations, which are grappling with fears that the global financial meltdown could lead to a worldwide recession.

Even non-OPEC members "should protect their interest by reducing oil production to stop the loss of income," said Shukri Ghanem, chairman of Libya's National Oil Corp.

"However, OPEC's aim is to create a balanced market, which neither harms the producers nor the importers," Ghanem told The Associated Press.

Libya is one of the 13 members of the Organization of Petroleum Exporting Countries.

OPEC's decision last month to cut production by 520,000 barrels a day failed to halt oil's slide.

Ghanem said "it seems there is a general understanding among most OPEC members" to hold an emergency meeting in mid-November instead of the scheduled Dec. 17 gathering in Algeria.

Earlier, Iran's official IRNA news agency quoted Oil Minister Gholam Hossein Nozari as saying the proposed meeting would address the reasons behind the decline in oil prices.

IRNA said the meeting may be held Nov. 18.

The decline in crude prices has fanned fears among OPEC members, many of whose economies are heavily dependent on oil exports.

Iran, the organization's second largest oil exporter, generates about 80 percent of its revenue from oil exports.

"OPEC members are now facing two problems. First is the deterioration of oil prices and second is the erosion of their investment due to the world economic crisis," Ghana said.

On Wednesday, Venezuelan President Hugo Chavez said that some OPEC members are calling for an extraordinary meeting as world oil prices continue a downward spiral.