JERUSALEM, June 30 (Reuters) - Israel may upgrade the mandate of its investigation of a deadly raid on a Gaza-bound flotilla, by allowing it to subpoena witnesses, a statement from Prime Minister Benjamin Netanyahu's office said.

The panel headed by former Israeli Supreme Court justice Jacob Turkel launched its probe on Monday and served notice that Netanyahu and his defence chief may be called to testify about the May 31 incident in which nine Turkish citizens were killed.

Israel went ahead with the inquiry after a world outcry against the raid, though it rejected a United Nations proposal for an international probe. The raid by Israeli commandos put a spotlight on Israel's blockade of Hamas-ruled Gaza, which has since been eased.

The Israeli statement published on Tuesday, said Turkel had filed "a request to broaden the authorities of the committee (investigating) with respect to the ability to require witnesses to appear before it and give testimony under oath."

"There is no reason not to give positive consideration to this request," it said, adding that ministers would also weigh a separate appeal to expand the number of members on the panel, and soon ask the Israeli cabinet to render a formal decision.

In addition to Turkel, the panel includes an Israeli expert on international law, a former general, and two non-voting foreign observers: David Trimble, a Northern Ireland politician and Nobel Peace Prize laureate, and Canadian jurist Ken Watkin.

Due to the limited scope of the inquiry, it is seen as unlikely to pose any political threat to Netanyahu's year and a half old right-wing government.

Turkel has said his panel's mandate calls for an examination of whether Israel's naval blockade and the flotilla's interception conformed with international law as well as an investigation of the actions of the convoy's organisers and participants.

The flotilla incident has soured Israel's strategic ties with Turkey, an important Islamic ally, which has since recalled its ambassador and cancelled joint military exercises with the Jewish state.

Israel has said its commandos, who boarded one of the Turkish-sponsored vessels to enforce the blockade it sees as necessary to prevent weapons from reaching Islamist militants, opened fire when activists assaulted them with knives and clubs.

In response to Western criticism, including from its biggest ally, the United States, Israel has since eased a land blockade of Gaza where 1.5 million Palestinians live, allowing most civilian goods through, while continuing to enforce a naval embargo of the coastal territory.