VIENNA, DEC. 9 -- OPEC oil ministers today started their year-end summit meeting here split over whether to increase oil prices and over how to deal with continued surplus production that is knocking them down.

Iran and Libya want an increase in the Organization of Petroleum Exporting Countries' benchmark price from $18 to more than $20 per barrel, but the other OPEC members oppose increases at this time.

Experts here expect the demand for OPEC oil to sink below 16 million barrels per day in early 1988. The 13 OPEC countries now produce some 18.5 million barrels of oil per day, far above the overall quota of 16.6 million barrels daily established for the second half of 1987.

Iraq, which is at war with Iran, continues to ignore its production quota, selling about 3 million barrels per day -- double its allotment. Iraq wants its quota increased to match Iran's -- 2.7 million barrels daily -- before it will comply.

Iran is reported to be producing less than its quota as a result of U.S. and French embargoes, although the Iranian oil minister, Gholamreza Aqazadeh, said the embargo measures are having no effect at all.

At the opening session, Rilwanu Lukman of Nigeria, OPEC's president, warned members against continued overproduction that could endanger OPEC's move this year to cut overall output and boost the price of crude from its 1986 price of $10.

Lukman spoke of a fragile market situation and carefully avoided references either to price increases in 1988 or to a proposal to substitute a basket of currencies for the dollar in pricing oil. The Iranian oil minister said the price of OPEC oil should have risen by $2.70 to make up for the decline of the dollar since June.

Lukman repeated calls for cooperation between OPEC and non-OPEC producers to stabilize the market, saying the burden for maintaining price levels was still being borne largely by OPEC, which is producing at half its capacity.

The OPEC president said oil companies also have a responsibility for stabilizing the market, especially in countries where critical decisions are made at company rather than national levels. He said the firms wanted "stability on the one hand and the freedom to play the market on the other."