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updated 11/29/2010 6:16:40 PM ET 2010-11-29T23:16:40

Retail gasoline prices should decline across much of the country as demand ebbs with the arrival of the winter months.

The national average for a gallon of unleaded regular gasoline was $2.857 on Monday, according to AAA, Wright Express and Oil Price Information Service. That's about 1.5 cents lower than it was a week ago but about 23 cents higher than a year ago.

That's just about the same as the weekly reading from the Energy Department, which put retail gasoline at $2.856 a gallon, which was 2 cents less than it was a week ago.

"No doubt we had a busy weekend and we used a lot of fuel," said Tom Kloza, publisher and chief oil analyst at Oil Price Information Service. "I still think it's a slow bail, a slow sort of drift downward for most of the country for retail prices."

The analyst predicted the national average would hover around $2.70 a gallon by the end of the year and, in some parts of the country, could be even cheaper, as demand historically hits its lowest point during December and January.

The highest prices on Monday could be found along the West Coast and parts of the Northeast, where gas ranges from $3.006 to $3.510 a gallon.

For example, Los Angeles drivers paid $3.134 a gallon Monday, which was 1.6 cents lower than a week ago; San Diego drivers paid $3.145 a gallon, which was about a penny lower than the past week; and Portland, Maine, drivers paid $3.024 a gallon, which was 0.4 cent less than a week ago.

The lowest prices were in Texas, much of the Midwest, parts of the South and Colorado. Dallas motorists paid an average of $2.644 a gallon, which was a drop of 3.4 cents from a week ago; Atlanta motorists paid $2.724 a gallon, which was a drop of 2.4 cents; and Kansas City, Mo., motorists paid $2.607, which was a drop of 6.3 cents.

Meanwhile, oil prices edged higher after the European Union agreed on a bailout plan for Ireland, although some concern lingered that a financial crisis could surface in Portugal and Spain.

Traders also worried about ongoing tensions between North Korea and South Korea and whether they could create problems that could affect oil deliveries in that part of the world, said George Gero, vice president of RBC Global Futures.

The gain came even as the dollar was stronger against other currencies. Since oil and other commodities are priced in dollars, a stronger dollar makes them more expensive for buyers who use foreign currencies.

Benchmark crude for January delivery rose $1.97 to settle at $85.73 a barrel on the New York Mercantile Exchange.

In other Nymex trading in December contracts, heating oil rose 4.19 cents to settle at $2.3581 a gallon and gasoline added 7.43 cents at $2.2846 a gallon. Natural gas for January delivery lost 18.9 cents to $4.210 per 1,000 cubic feet.

In London, Brent crude added $1.54 to settle at $87.34 a barrel on the ICE Futures exchange.

Copyright 2010 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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