OSLO, March 7 (Reuters) - Norway's ruling Labour party is chewing away at the opposition's opinion poll lead before elections on Sept. 9, meaning the winning bloc could struggle to form a majority coalition and would rely on smaller parties.
Support for Prime Minister Jens Stoltenberg's party rose 2 percentage points to 29 percent while support for the Conservative Party led by Erna Solberg fell 4 percent to 32 percent, a poll in daily Dagsavisen showed on Thursday.
Support for the Conservatives rose as high as 40 percent earlier this year, according to some polls, but controversial policy initiatives, like a proposal to reduce the wealth tax on the wealthiest Norwegians, dented support.
The Conservatives along with their perceived ally, the populist Progress Party, are still expected to win 88 seats, three more than needed for a majority, but any further decline for the centre-right could throw the election open.
A Conservative-led government could support selling down stakes in state-owned companies such as Statoil or Telenor. But the inclusion of smaller parties, like the Liberals or the Christian Democrats, would make it more difficult to push through major policy changes.
The centre-right parties also said they would lower taxes and ease the regulatory burden for companies.
Stoltenberg, in office since 2005, has presided over a rare economic success story thanks to Norway's immense oil wealth. But discontent has increased over a lack of improvement in health, education, and social services, as well as over a number of high-profile sex scandals. (Reporting by Balazs Koranyi; Editing by Mark Heinrich)