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NEW YORK -- The average price for regular gasoline at the pump fell to $1.66 per gallon last week, a drop of 9 cents, or 5.1 percent, in the two weeks ended Dec. 19, according to Trillby Lundberg’s survey of 7,000 filling stations.
"It is not high price any longer, obviously, that is cutting into our gasoline demand," Lundberg said in a Bloomberg News interview. "It is in fact the weaker economy and fewer people working."
Crude oil, which accounts for approximately 59 percent of gasoline’s pump price, has tumbled 77 percent from a record $147.27 a barrel reached July 11, on the New York Mercantile Exchange, according to Bloomberg News.
AAA, the nation’s biggest motoring club, reported
regular gasoline at the pump averaged $1.668 a gallon, down 59 percent from the record $4.114 in July. According to the AAA Daily Fuel Gauge Report, gasoline sold for $2.22 a gallon one month ago. A year ago, it sold for $2.99 a gallon.
The Organization of Petroleum Exporting Countries, which pumps 40 percent of the world’s oil, agreed on Dec. 17, to cut output by 2.46 million barrels a day starting Jan. 1, in an effort to bolster slumping prices. The "precipitous" drop in the price of oil—along with the frozen credit markets—was one reason given by Flying J CEO J. Phillip Adams for the company’s Chapter 11 reorganization filing yesterday. See related lead story on CSNews Online by clicking here.
OPEC’s supply cuts may be outpaced by waning demand for fuel as the recession in the U.S. deepens. A gauge of leading indicators posted its biggest annual drop since 1991 in November, the Conference Board said last week.
Bloomberg also reported on a MasterCard report that said U.S. gasoline demand dropped 5.4 percent in the week ended Dec. 12, the most since Oct. 24.
Motorists bought an average 9.098 million barrels of gasoline a day, down from 9.617 million a year earlier, MasterCard, the second-biggest credit-card company, said in its weekly SpendingPulse report.
The highest average price for self-serve regular gasoline in the U.S. was $2.41 a gallon in Anchorage, Alaska, Lundberg said. The lowest was in Cheyenne, Wyo., at $1.37 a gallon.