U.S. gasoline prices drop 17% in 2 weeks

The average price of regular gasoline at U.S. filling stations took a dramatic tumble across the nation in the last two weeks, falling to $2.30 a gallon as the global economic slowdown crimped demand.

Gasoline dropped 48 cents, or 17%, in the two weeks that ended Friday, according to oil analyst Trilby Lundberg’s survey of gas stations nationwide. The survey, released Sunday, found mid-grade gasoline at $2.44 and premium at $2.56. Diesel was at $3.19.

The California average was $2.57, down 61 cents from two weeks ago. The highest was in San Francisco, at $2.65 for a gallon of regular, while the least expensive was in Stockton at $2.30.

Nationwide, gas was cheapest in Tulsa, Okla., at $1.89 for a gallon of regular. It was most expensive in Anchorage, at $3.14.

“The price crash was caused by lower crude oil prices and lower gasoline demand,” Lundberg said in a Bloomberg Radio interview. “There has never been a price crash of this magnitude.”

Crude oil, which accounts for about 67% of gasoline’s pump price, has tumbled 59% from a record $147.27 a barrel reached July 11.

AAA, the nation’s biggest motoring club, said that regular gasoline at the pump averaged $2.259 a gallon, down 45% from the record $4.114 reached July 17.

U.S. fuel demand during the last four weeks averaged 19.1 million barrels a day, down 7.7% from a year earlier, the Energy Department said Nov. 5.

Crude oil on the New York Mercantile Exchange fell to $59.97 a barrel Friday, the lowest since March 22, 2007, before settling at $61.04. The futures are down 37% from a year ago.

Gasoline futures on the New York Mercantile Exchange rose Friday for the first time in three days, gaining 1.35 cents, or 1%, to settle at $1.3495 a gallon.

U.S. gasoline demand fell 3.9% in the week that ended Oct. 31 as motorists drove less, a Nov. 4 report from MasterCard Inc. showed.

Motorists bought an average of 9.015 million barrels of gasoline a day, down from 9.378 million a year earlier, MasterCard, the second-biggest credit card company, said in its weekly SpendingPulse report. Year-over-year demand has declined for 28 straight weeks.

Gasoline demand this year peaked at 9.65 million barrels a day in the week that ended Aug. 1, 5.9% below the 2007 maximum of 10.25 million in the week that ended Aug. 17.

The decline comes as tight credit, bank failures and rising unemployment may indicate a recession that would further curtail fuel consumption.

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The Associated Press and Bloomberg News were used in compiling this report.