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Oil prices dip on API data
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August 30, 2000: 12:31 p.m. ET
Crude futures retreat on increase in U.S. stocks; heating oil fears remain
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NEW YORK (CNNfn) - Crude oil prices edged lower in early afternoon trade Wednesday after a weekly American Petroleum Institute report showed higher-than-expected oil inventories.
The American Petroleum Institute late Tuesday said crude stocks in the United States rose by a hefty 5.26 million barrels in the week ended Aug. 25. Analysts had forecasted between 1.2 million to 2.1 million barrels.
"The inventory build was two-to-three times greater than expected, and oil prices are backing off," said James Wicklund, oil analyst at Dain Rauscher Wessels.
U.S. light sweet crude futures for October delivery fell 36 cents to $32.38 a barrel on the New York Mercantile Exchange. London's benchmark Brent for October delivery dipped 37 cents to $30.99.
But analysts noted the data reflected only one week. Inventories remained near 24-year lows, and fears of heating oil shortages this winter continued.
"The underlying fundamentals for crude prices are still bullish," said Thomas Parker, oil and gas analyst at Chase Manhattan Bank. "Heating oil inventories have a long way to go to be ready for winter."
Prices have refused to leave the $30 danger zone, spreading anxiety in consuming nations and stepping up pressure on the Organization of the Petroleum Exporting Countries (OPEC) to boost production at its September 10 ministerial meeting in Vienna.
OPEC, locked in a fierce battle with soaring prices despite previous supply increases, is expected to turn up the taps by an extra 500,000 barrels per day at that conference. But jittery traders worry that will not be enough to meet an expected jump in heating oil demand this winter.
Saudi to work with OPEC
Saudi Arabia, the world's biggest oil exporter, said Wednesday it would work with others in OPEC for a "suitable rise" in oil output to restore balance to the oil markets and stabilize runaway crude prices.
A statement from the Supreme Petroleum Council for Petroleum and Mineral Affairs (SPC), Saudi's highest authority on energy affairs, said Riyadh wanted an OPEC review of its mechanism for stabilizing prices.
The SPC instructed Oil Minster Ali al-Naimi, after a meeting in Jeddah, "to review the appropriate mechanism that would achieve this stability in coordination with other producing countries."
The statement was reported by the official Saudi Press Agency. 
-- compiled from staff and wire reports
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