* OPEC lifts 2013 world oil demand growth view

* Iran converts some enriched uranium into reactor fuel

* U.S. crude stocks seen up 2.9 mln bbls -Reuters poll

* Coming up: API weekly crude stocks 4:30 p.m. EST (2130 GMT

(Recasts with updated prices, market activity; changes byline and dateline, pvs LONDON)

By Gabriel Debenedetti

NEW YORK, Feb 12 (Reuters) - Oil prices rose on Tuesday as OPEC raised the outlook for the amount of crude it will need to pump this year to keep supply and demand in balance.

The 12-member Organization of the Petroleum Exporting Countries said in its monthly market report that world oil demand will grow faster than previously thought this year.

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"Overall, I would say the OPEC report is constructive and mildly bullish based on the demand forecast," said Dominick Chirichella, senior partner at Energy Management Institute in New York.

Brent crude LCoc1 rose 12 cents to $118.25 a barrel by 10:39 a.m. EST (1539 GMT) after settling down 77 cents on Monday.

U.S. crude CLc1 was up 46 cents to $97.49 a barrel.

The RBOB gasoline contract RBc1 rose after losses on Monday following a less-damaging-than-expected blizzard in the U.S. Northeast over the weekend.

Supply worries stemming from conflict in the Middle East persisted on Tuesday, as investors eyed Iran's nuclear program more than North Korea's third nuclear test. ID:nL4N0BC0Y4

Tensions eased on Tuesday when Iran acknowledged it was converting some of its higher-grade enriched uranium into reactor fuel, a move that could help prevent a dispute with the West over its nuclear program hitting a crisis in mid-2013.

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Israeli Prime Minister Benjamin Netanyahu said Monday the new centrifuges Iran was installing for uranium enrichment could cut by a third the time needed to create a nuclear bomb. Tehran says its nuclear programme is for peaceful energy purposes.

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DOMESTIC SUPPLY

Oil markets also focused on weekly inventory data in the United States, the world's top oil consumer. U.S. commercial crude oil stockpiles are expected to have risen by 2.9 million barrels last week, a preliminary Reuters poll showed on Monday.

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Distillate stocks, which include heating oil and diesel fuel, were projected to be down 800,000 barrels, while gasoline inventories were seen unchanged.

The American Petroleum Institute, an industry group, is expected to release its weekly report at 4:30 p.m. EST (2130 GMT). The U.S. government's Energy Information Administration is due to follow with its own figures on Wednesday.

(Additional reporting by Peg Mackey in London and Osamu Tsukimori in Tokyo; Editing by Alison Birrane and Nick Zieminski)

((Gabriel.Debenedetti@thomsonreuters.com)(+1-646-223-6184)(Reut ers Messaging: Gabriel.debenedetti.thomsonreuters.com@reuters.net))

Keywords: MARKETS OIL/