Oil slips further below $80/bbl on talk OPEC may lift output

* OPEC, other exporters may ease cuts 'softly' -Novak

* OPEC set to meet next month to discuss policy

* Oil supported as dollar falls after Trump scraps summit (New (KOSDAQ: 160550.KQ - news) throughout, updates prices, market activity and comments)

By Stephanie Kelly

NEW YORK, May 24 (Reuters) - Oil prices fell on Thursday, with expectations building that reduced supplies from Venezuela and Iran could prompt OPEC to wind down output cuts in place since the start of 2017.

Brent crude futures fell 55 cents to $79.25 a barrel, a 0.7 percent loss, by 1:08 p.m. EDT (1708 GMT). U.S. West Texas Intermediate (WTI) crude futures fell 1 percent, or 68 cents, to $71.16 a barrel.

The Organization of the Petroleum Exporting Countries may decide in June to lift output to make up for reduced supply from crisis-hit Venezuela and Iran, which was stung by the U.S. decision to withdraw from the nuclear arms control deal, OPEC and oil industry sources told Reuters.

Russian Energy Minister Alexander Novak said production cuts could be eased "softly" if OPEC and non-OPEC countries see the oil market balancing in June, the Interfax news agency reported.

Russia and Saudi Arabia have a common position on the future of the oil output cut deal, Novak told Interfax news agency, though he said the deal would stay in place for now. Russia's Lukoil said the deal should remain in place but needs to be altered.

"We still believe that a production increase will still be forthcoming that will become official at next month's OPEC meeting," Jim Ritterbusch, president of Ritterbusch and Associates, said in a note. "In the meantime, even the slightest suggestion of such a decision, especially from the Saudis, could force a 1-2 percent price selloff as seen this morning."

Venezuela's output has fallen to about 1.4 million barrels per day, according to OPEC secondary sources, as its economic crisis grows and state-run PDVSA struggles to pay debts and fund operations.

Supply concerns have pushed crude to multi-year highs, with Brent last week breaking above $80 a barrel for the first time since November 2014.

OPEC and some other major oil producers, scheduled to meet in Vienna next month, previously agreed to curb combined output by about 1.8 million bpd to boost prices and clear a supply glut.

Global inventories have been broadly falling, even as U.S. crude production has risen. The United States in February produced 10.3 million bpd, a record.

On Thursday, U.S. President Donald Trump called off a planned summit with North Korean leader Kim Jong Un over that nation's nuclear aims. The news should have pressured oil prices, but the comments weakened the U.S. dollar, which supported crude, Commerzbank (Xetra: CBK100 - news) strategist Carsten Fritsch said.

A weaker dollar makes greenback-denominated commodities less expensive for holders of other currencies. The dollar fell more than 0.3 percent against a basket of currencies. (Additional reporting by Amanda Cooper and Ahmad Ghaddar in London, Jane Chung in Seoul and Jessica Jaganathan in Singapore Editing by David Gregorio and Marguerita Choy)