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CAMARILLO, Calif. -- Gas prices dropped 6.44 cents per gallon on average over the past two weeks as crude oil prices continued to fall in the wake of the Iraq war, according to analyst Trilby Lundberg.
The average price for gas nationwide, including all grades and taxes, was about $1.58 per gallon, according to the Lundberg Survey of 8,000 gas stations and convenience stores. On April 18, the date of the last Lundberg Survey, gas cost about $1.64 a gallon.
It was the third straight two-week drop, adding up to a decline of more than 18 cents per gallon since prices peaked March 21 at an average of $1.76 per gallon, Lundberg said. One year ago, on May 3, 2002, the average price of gas was $1.45 per gallon.
"The national average price of gasoline at self-serve pumps, including taxes, was about $1.55 for regular, $1.65 for mid-grade and $1.74 for premium.
Crude oil prices had several dollars extra per barrel built in prior to the war in Iraq because Iraq had threatened to destroy its own oil resources, and that was prevented," Lundberg said. "The response of the oil market was a price crash."
Venezuela's continuing recovery from its oil industry strike is also contributing to the price declines, Lundberg said. She said Venezuela is now back up to, or close to, its pre-strike production level of 3.2 million barrels per day.
The downward gas price trend could continue, Lundberg said, though OPEC countries agreed to reduce output by 2 million barrels a day in an attempt to stop the tumble of crude prices.