Mick Fanning missed a chance to claim his third world surfing championship on Thursday when he was beaten in the quarter finals at the Portugal Pro.

NSW surfer Kai Otton won their heat with ten points to Fanning's 9.43 in inconsistent one-metres waves.

Fanning, 32, needed to make the semis to accumulate sufficient points to take the crown before the season-ending event in Hawaii in December.

His nearest challenger, 11-time champion American Kelly Slater, was eliminated in the second round at Peniche but can still take the title with a win at the Pipeline Masters.