Pump prices continued to tumble in the past week, falling more than 25 cents to a national average of $2.656 a gallon, new government figures show. In some places, gasoline is now selling for less than $2 a gallon.
A weekly report released Monday afternoon by the U.S. Energy Information Administration showed the Gulf Coast had the cheapest prices with an average of $2.46 a gallon, down 27.4 cents in the past week. The Midwest was next lowest at $2.497, followed by the East Coast ($2.684), the Rocky Mountain region ($2.762) and the West Coast ($3.05).
Prices have fallen nearly 50 cents in the past two weeks and are down almost 22 cents from a year ago.
Nationally, the average price for diesel fuel was $3.288, down 19.4 cents in the past week, the EIA reported.
Already, gasoline prices have dipped below $2 a gallon in some parts of the U.S. as the impact of plunging oil prices and reduced driving are finally taking hold.
In Ohio, the Web site GasBuddy.com, where consumers post prices they spot, said a few stations in the Cincinnati suburbs were now charging $1.99 for regular.
The national average for a gallon of regular fell 3 cents overnight to $2.668, according to auto club AAA, the Oil Price Information Service and Wright Express. That's roughly a dollar less than what was paid just a month ago and 18 cents below year-ago prices.
Only three states — Alaska, California and Hawaii — have average prices for regular grade above $3 a gallon, AAA said.
Gasoline prices have been sliding as oil prices have dropped to the lowest level in more than a year, dipping below $62 a barrel at one point Monday. Oil prices have plunged 57 percent from a record $147.27 on July 11.
The markets are worried about the potential for a severe global economic slowdown that would curb demand for fuel.
As well, gasoline prices typically decline at this time of year after the peak summer driving season, adding to the steep fall off, said oil trader and analyst Stephen Schork. He says the national average for gas could reach $2.25 a gallon in the coming weeks.
"We have to appreciate what extraordinary circumstances we're now dealing with," Schork said. "We've had a major correction in the price of crude oil, and that correction is having a knockout effect on gasoline prices. This great unraveling that we're seeing in all commodity prices is exaggerating the seasonality of this market."
The rise and fall of fuel prices has certainly had an effect on Americans' driving habits.
From last November through August, Americans drove 78.1 billion fewer miles than they did over the same 10-month period a year earlier, according to data from the Transportation Department released Friday.
Despite the price decline, however, some retailers say gasoline sales are down on weekends by as much as 10 percent from a year ago — a sign that some are driving only when necessary.
"I think the mentality of the consumer is, 'Yes, it's nice to have $2.50 gasoline, but I feel much poorer today than I did when it was $4 a gallon,'" said Ben Brockwell, director of data, pricing and information services for the Oil Price Information Service. "I think people are still in a money-saving mode."