Gas nears three-year low

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NEW YORK (CNNMoney.com) -- Gasoline prices fell overnight, settling Tuesday to approach the lowest level in roughly three years, according to the American Automobile Association.

The national average price for a gallon of regular gas fell to $2.629, down 3.9 cents from the day before, according to AAA's Daily Fuel Gauge Report.

The last time gas was this low was Oct. 24, 2005 at $2.6237 a gallon.

Today marks the 41st straight day that prices have dropped. Gas is down 36.1%, or $1.485, from the record-high price of $4.114 that AAA reported in mid-July. Gas is down 28.07%, or $1.026, from the month ago average.

On Oct. 18, the average price dropped below $3 a gallon for the first time in nearly nine months.

Alaska has the most expensive gas in the nation at an average of $3.645 a gallon, while Oklahoma has the cheapest gas at $2.219 a gallon.

Demand for gas is dropping, as Americans drive less and consume less gas compared to last year. In August, Americans drove 5.6% less than a year ago, marking the biggest single-month decline in miles traveled since the government started collecting the data.

Oil, which makes up about half of the price of gasoline, fell Monday to its lowest price in 17 months. U.S. crude for December delivery is up 78 cents to $64 a barrel in New York.