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SEOUL, June 5 (Reuters) Nigeria will increase its oil output by 1.5 million barrels per day by next year, contributing to OPEC's spare capacity, OPEC President and Nigerian Oil Minister Edmund Daukoru said on Monday.

Daukoru made the comments after meeting South Korean President Roh Moo-hyun earlier on Monday.

''For the sake of steady supply and stability of the global oil market, OPEC members Saudi Araba and Kuwait are adding new production capacity, and Nigeria will boost output by 1.5 million barrels per day by next year, which will contribute to OPEC's spare capacity,'' Daukoru was quoted as saying in a statement released by the presidential Blue House.

The Organization of the Petroleum Exporting Countries agreed on Thursday to leave oil output unchanged near its full capacity, news that failed to soothe oil markets. U.S. crude traded up $1.10 at $73.43 a barrel on Monday, within $2 of a record high.

''I can tell you that we (OPEC) are concerned about high oil prices,'' Daukoru told reporters later on Monday, noting concerns that high oil prices could trigger a switch to alternative fuels.

He blamed bottlenecks in the downstream sector, a lack of flexibility between countries in terms of fuel specifications and speculative funds for exacerbating high oil prices.

''In the upstream, I do believe global demand at any given time, at least for the past three years, has always been substantially met. Supply has always slightly exceeded demand,'' he added.

''It's a matter of market perception which is not based on a reality,'' Daukoru said.

A greater volume of spare capacity could help OPEC stem an over three-year oil price rally, fuelled in part by fears that producers and refiners would be unable to compensate supplies in the case of any sudden, unexpected outages.

Over the past year Nigeria, the biggest oil producer in Africa, has begun pumping oil from Royal Dutch Shell's 225,000 bpd Bonga field and ExxonMobil's 150,000 bpd field, with more developments led by Total and Chevron expected to follow over the next two years.

The offshore fields have typically been immune to the kind of militant attacks that have shut in 550,000 bpd of onshore production in the Niger Delta, a quarter of Nigeria's total.

But an unprecedented raid on a rig 40 miles offshore last Friday heightened fears about the safety of more remote facilities. Gunmen who kidnapped eight foreign workers in that attack freed the captives on Sunday.

REUTERS PV BD1557