Oli, 65, served as the country's prime minister from October 11, 2015 to August 3, 2016. He is known for his pro-China stance.
A Standing Committee (SC) of the party held in Lalitpur named Oli as the prime ministerial candidate as he is also the UML's Parliamentary Party leader, Surendra Pandey was quoted as saying by The Kathmandu Post.
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It had also secured an overwhelming majority in the upper house of Parliament with 39 seats, paving the way for the leftist alliance to form the country's next government.
The UML leaders also discussed the party unification with the CPN (Maoist Centre) during the meeting, the report said.
Following an intra-party discussion of both the parties, a meeting of the Party Unification Coordination Committee (PUCC) is scheduled to be held later today, it said.
The PUCC meeting is likely to take a final decision regarding the party unification.
The PUCC of the left alliance was formed to discuss the merger of the two parties.
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