Business Notes PETROLEUM

Not since the oil glut of 1986 have petroleum prices gone on such a wild ride. During trading last week, the futures price of crude fell below $16.50 per bbl. for the benchmark West Texas Intermediate, down more than $2 from the previous week and $5 since early March. While demand for oil usually softens during springtime, new calculations of the world's oil production have stunned commodity traders. Total output by the Organization of Petroleum Exporting Countries exceeds 24.5 million bbl. per day, or 2 million beyond its agreed ceiling. At the same time, Saudi Arabia said it had discovered a huge new oil field.

The fall in prices should help industrial countries reduce inflation. But for oil producers, lower prices could bring a precipitous drop in export earnings. OPEC members are so alarmed that Sadek Boussena of Algeria, the group's acting president, has been consulting with other members to consider calling an emergency meeting to deal with the glut.

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CAPTION: Oil Price