Gas nears 5-year low

The price of gas at the pump has plummeted almost $2.50 since the summer, according to AAA.

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By Kenneth Musante, staff writer

What was the biggest business news story of 2008?
  • Auto industry meltdown
  • Bailout of Wall Street
  • Foreclosure storm
  • Oil price's wild ride
  • Stock market meltdown
  • It's official: U.S. in recession

New York ( -- As 2009 approaches, plummeting oil prices have sent the price of gasoline to the lowest level in nearly five years, according to a daily survey of gas station credit card swipes.

Gas prices fell for the tenth consecutive day Monday, according to motorist group AAA. Regular unleaded fell to an average of $1.619 a gallon, the lowest since gas hit $1.617 a gallon in January 2004.

Prices are down nearly $2.50, or more than 60%, since hitting a record average high of $4.114 a gallon this July. Prices have plummeted along with the price of crude oil, the main ingredient in gas, as the current economic has crisis intensified and threatened demand for petroleum-based fuels.

Oil has shed more than $100 a barrel since July.

"When you have the price for the raw material drop over $100 a barrel, that's why you see the price of gasoline drop," said AAA spokesman Troy Green.

In the United States, the world's largest oil consumer, citizens drove 100 billion fewer miles during the 12-month period between November 2007 and October 2008 compared with the prior year, according to the U.S. Department of Transportation.

And crude demand in China fell 3.2% in November compared to the prior year due to lower imports and a decline in refinery usage, according to estimates compiled by Reuters.

Gas may continue to sell at record lows heading into 2009 unless economic activity shows some sign of recovery, according to Green.

Usually gas prices rise in the spring as Americans take to the road.

"Will the economy be in such bad shape that we don't see that typical runup?" posed Green.

State prices: Prices remained above $2 a gallon in only two states Monday: Alaska ($2.518) and Hawaii ($2.332).

Gas was cheapest in Missouri at $1.419 a gallon on average, and sold for less than $1.50 on average in ten states.

Diesel: Meanwhile the price of diesel fuel, which is used in most trucks and commercial vehicles, fell to $2.435 on average Monday.

The AAA figures, compiled by Oil Price Information Services, are state-wide averages based on credit card swipes at up to 100,000 service stations across the nation. To top of page

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