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To: Patrick Slevin who wrote (43628)	5/20/1998 10:22:00 AM
From: jluker	Read Replies (1) \| Respond to of 58727

FYI-Petroleum Crude oil futures prices Tuesday tumbled to a 9 1/2-year low on the New York Mercantile Exchange as U.S. inventories stood at their highest level in five years despite output cuts by some world producers. Crude oil futures fell despite news that a Nigerian refinery outage is likely to hold 375,000 barrels of crude off the market over the next three days, as traders expressed growing concern about rising U.S. inventories. Despite a decision by members of the Organization of Petroleum Exporting Countries and other large oil producers to cut some 1.72 million barrels daily from production, American crude inventory levels last week rose to their highest since December 1993, according to the American Petroleum Institute. The industry group was expected to provide new inventory figures late Tuesday, and few held out hope the situation would improve considerably. Analysts say economic troubles in Southeast Asia, which have dimmed demand to that region, has led to a battle among producers to find other markets, leading to more U.S. imports at favorable prices. Alarmed futures traders have been steadily driving prices lower for the past month after it became clear the production cuts by the 17 producing countries were not enough. Investors said there is now so much oil domestically that storage tanks, particularly in the Midwest region, are near capacity. The Cushing, Okla., storage site saw inventories rise to their highest levels in five years, analysts said. Market participants ignored comments made Monday by Saudi Arabia's oil minister that some 500,000 more barrels a day should be cut from daily production. Few observers believe oil producers will take any action before OPEC meets next month to discuss prices.